In the second addition of AYP’s Webinar Series, we discuss high-speed market entry into various countries in the ASEAN Region. Namely Singapore, Malaysia, Indonesia, the Philippines, Thailand and Vietnam. We discuss Professional Employer Organization (PEO) and Employer of Record (EOR), and how these two can be important factors into quickly and efficiently entering a market in any of the aforementioned countries. In this addition of AYP’s Webinar Series, we have experienced and esteemed in-house experts and consultants to guide you through the process and factors that affect high-speed market entry, and how you can use these to your company’s benefit.
In Vietnam’s addition of the AYP High-Speed Market Entry Webinar, the main speaker was Ho Thi Hong Yen. Yen has an extensive ten-year experience in both HR and Payroll operations. As the assistant country manager of AYP Vietnam, Yen is responsible for developing strong partnerships with clients and enabling them to expand their business throughout the country. In this webinar, Yen discusses the benefits of using a PEO/EOR Service, its’ scope of service, contract types, labour laws and benefits in the Philippines, along with success and ROI of using a PEO Service.
Benefits of Using PEO/EOR:
The use of a PEO/EOR Service essentially links clients to employees through AYP, regardless of their location. The service no doubt provides convenience for clients, as services such as payroll and tax management are taken care of by AYP. Furthermore, worry-free and convenient HR Administration and simple work pass management. The PEO Service also allows for an organisation to quickly and efficiently enter markets all over the region, without the need of an initial local entity. All in all, AYP’s PEO/EOR Service provides efficiency and cost-effectivity to clients.
Service Scope: Should one engage AYP for PEO/EOR Services, AYP is then responsible for drafting the company’s employment contracts, insurance coverage and payroll-related services. AYP also takes care of HR Support, the on-boarding process for new employees as well as updates on local labour laws and regulations.
Vietnam’s Contract Types, Labour Laws, Employee Benefits & Work Permits:
Vietnam has two different contract types, fixed term contracts and indefinite terms contracts. Every labour contract must contain an employer’s name and address, identification number of employees, labour contract terms, established work and rest times, social, unemployment and health insurance and other contents agreed on by both parties.
According to Vietnam labour laws, the employer has the right to terminate employment if the employee is not completing work on time or suffers from sickness or accidents. However, the employer has no right to terminate the labour contract if the employee is undergoing treatment for sickness or occupational accidents, is on annual or personal leave or maternity leave.
Employees are also entitled to medical reimbursements and paid sick leave, paid public holidays, a minimum of 12 days of annual leave and childcare, maternity and paid personal leave. Timely payment of salary is also required.
There are five types of visas in Vietnam. Firstly, the business visa which is valid for up to three months. Secondly, there is a work permit. Thirdly, an employment agreement whereby a definite labour contract of at least two years must be signed. It is also necessary for them to open up a bank account in Vietnam and apply for a temporary resident card.
A company which started operations in Vietnam required a salesperson, which they managed to recruit and provide PEO Services to. This has since resulted in retention of talented employees as well as helped the company grow exponentially in Vietnam.
Based on research done in 2019, the annual Return on Investment a company can achieve by utilising PEO/EOR Services is approximately 27.2% on cost savings alone. This includes savings in several HR-Related areas and the fact that this service can be provided without the need of any local entities to support this. Both clients and employees benefit greatly from PEO Services in terms of wellbeing, efficiency and cost-effectivity.