Insights
What is an EOR? Employer of Record in Vietnam explained
By Nguyễn Quốc Trung — Deputy General Director · Updated
EOR stands for Employer of Record — a local company that becomes the legal employer of your staff on your behalf. It is how a foreign company hires and pays Vietnamese employees lawfully without first setting up a Vietnamese entity. This guide explains the model, the framework Vietnam actually applies, the published cost, and when an EOR is the right choice.
Key facts (2026):
- An EOR becomes the legal employer; it is for companies with no Vietnamese entity hiring Vietnamese staff.
- Vietnam has no dedicated EOR law — the arrangement must sit inside labour sub-leasing or a commercial service contract.
- Nhân Kiệt fee: 8% of gross salary per person per month, floor VND 2,600,000, cap VND 5,200,000; deposit of one month's gross salary (refundable) from 1 October 2026.
- Staff can start in 5–7 working days instead of the 2–6 months it takes to incorporate.
What is an EOR?
An EOR (Employer of Record) is a local legal entity that acts as the official employer for the people you choose. The EOR signs the employment contract directly with each worker, pays compulsory social insurance, registers and remits personal income tax, runs monthly payroll, and carries the legal responsibility for that employment relationship. Your company signs a service agreement with the EOR and still decides who to hire, what to pay them, and what they work on.
How does an EOR work in practice?
You choose the person, the EOR employs them formally, and you reimburse the cost monthly. The sequence is usually: you select the candidate and the salary, the EOR signs the employment contract and registers insurance, the person starts working for you, each cycle you pre-fund payroll and statutory contributions, and the EOR pays your people in full and on time and then invoices its service fee. All the statutory records — contract, labour management book, payslips, annual leave — are kept by the EOR in the form the law requires.
Does Vietnam have a dedicated EOR law?
No — and this is the most important point most international providers gloss over. Vietnam has no legislation written for EOR, so an EOR arrangement must fit entirely inside one of two existing frameworks:
- Labour sub-leasing — Articles 52–57 of the Labour Code 2019 and Decree 145/2020/NĐ-CP. The client directs the work; it is limited to the 20 job categories in Appendix II and to a maximum of 12 months per worker under Article 53. The provider must hold a sub-leasing licence.
- A service contract under the Commercial Law — Nhân Kiệt assigns, manages and supervises the staff; there is no time limit, but the client does not direct each person the way it would its own employee.
Choosing the wrong framework is a risk for both parties: the client is penalised directly too, up to VND 100 million for organisations under Article 19(2) of Decree 283/2026/NĐ-CP, which replaced Decree 12/2022/NĐ-CP from 10 September 2026. So the applicable framework has to be settled before signing, not after an inspection.
How much does an EOR cost in Vietnam?
Nhân Kiệt's service fee is 8% of gross salary per person per month, with a floor of VND 2,600,000 (about USD 99) and a cap of VND 5,200,000 (about USD 199) per person per month. From 1 October 2026 there is also a deposit of one month's gross salary per employee, refundable when the contract ends and accounts are settled; there is no onboarding fee and no offboarding fee. On top of the service fee the employer bears salary and the employer-side statutory contributions for Vietnamese staff, which come to 23.5% (21.5% insurance plus 2% trade-union funding). A breakdown at different salary levels is in EOR pricing in Vietnam.
When should you use an EOR instead of incorporating?
Use an EOR when you need people working quickly and are not yet certain about long-term scale in Vietnam. Setting up your own entity normally takes 2–6 months and brings maintenance, accounting and reporting costs with it; through an EOR staff can start within 5–7 working days. The clearest fits are remote engineering teams, market-entry pilots, 6–24 month project teams, and the waiting period before an investment licence is granted. If you have already committed to long-term investment and will hire dozens of people, your own entity is usually cheaper on a total-cost basis.
How is an EOR different from a PEO?
An EOR is for companies that do not yet have a Vietnamese entity, while a PEO requires you to already have one and you remain the legal employer. The second difference matters just as much: at Nhân Kiệt, EOR serves Vietnamese employees, while PEO serves foreign nationals who need a work permit and a residence card. They solve different problems — the full comparison with a decision tree is in EOR vs PEO in Vietnam, and the PEO model is explained in what is a PEO.
What should you check before choosing an EOR provider?
Check the licences, which legal framework they will apply, and how transparent their pricing is. A credible provider can show a labour sub-leasing licence and an employment-services licence, will tell you plainly which of the two frameworks above your arrangement sits in, and publishes prices rather than only "contact us". Nhân Kiệt holds a labour sub-leasing licence (No. 15/2019/SHCM) and an employment-services licence (No. 22139/2023/45/SLĐTBXH-VLATLĐ) issued in Ho Chi Minh City, and is certified to ISO 9001:2015, ISO 45001 and ISO 14001.
Next step
If you are weighing up hiring Vietnamese staff without an entity, see the scope and commitments on the EOR Vietnam service page, or the labour compliance model if the people already work for you and need to move onto compliant contracts. To discuss a specific case, call +84 908 636 108 (Mr Trung) or +84 28 3505 4224. This is general information, not legal advice.
Call +84 908 636 108 or see labour compliance, payroll outsourcing, EOR Vietnam.