Update day: July 24 , 2023

Conditions for granting a labor subleasing license

In a developed economy, labor subleasing has become an important sector contributing to the development of industries and promoting economic growth. However, to ensure the right and safety of employees as well as employers, granting licenses for labor subleasing operations plays an extremely important role.

The grant of a labor subleasing license requires full compliance with conditions on labor rights, employer responsibilities, safety, and occupational health, along with tax regulations, and other business conditions. The licensing process requires verification and confirmation of compliance with these standards, to ensure that labor subleasing is conducted legally and to the beneficially for relevant parties.

Table of contents:

1. Conditions for granting a labor subleasing license

Performing the procedures to be granted a labor subleasing license is a mandatory condition for an enterprise to be allowed to provide labor subleasing services in the market. This step will be performed after the enterprise has completed procedures at the Department of Planning and Investment. To apply for the granting of a labor subleasing license, the enterprise should take note of fulfilling the following conditions:

Condition regarding the legal representative of the enterprise

Accordingly, the legal representative of the enterprise engaging in labor subleasing operation must meet all requirements: Being the manager of the enterprise by the Law on Enterprises; None criminal records; Having worked directly as a specialist or manager in labor subleasing or labor supply at least for full 03 years (36 months) within 05 consecutive years before applying for the license.

Conditions regarding deposit

To perform labor subleasing operations, the law requires enterprises to fulfill a deposit obligation, the current deposit level is 2,000,000,000 VND (2 billion VND). The deposit is used for salary payment, social insurance, health insurance, unemployment insurance, occupational accident insurance, occupational health insurance, and other regimes for subleasing employees as agreement upon the labor contract, collective labor agreement, internal rules and regulations of the subleasing enterprise, or compensate the subleasing employees in case the subleasing enterprise violates the labor contract or causes damage to the subleasing employees due to failure to ensure the legitimate rights and interests of the subleasing employees.

To monitor the compliance of the enterprise in maintaining the deposit, the law requires the bank receiving the enterprise’s deposit shall perform quarterly reporting obligations periodically on the deposit performance of the subleasing enterprise according to Form No. 11/PLIII Appendix III, issued attached to this Decree and send it to the provincial or municipal city State Bank branch, the Chairman of the provincial People Community, the Department of Labor, War invalids and Social Affairs, where the enterprise head office is located before the 15^th of the first month next quarter.

2. Dossier of application for a Subleasing Labor License

According to the provisions of Article 24 of Decree 145/2020/ND-CP, enterprises need to prepare the following documents to apply for a Labor Subleasing License: (i) A written request for a license from the enterprise; (ii) Autobiographical curriculum vitae of the legal representative; (iii) Judicial record card No. 1 of the legal representative; (iv) Certificate of deposit for labor subleasing; (v) A document proving the legal representative’s time as a professional or manager in labor subleasing or labor supply is one of the following types of documents:

A certified true copy of the original labor contract or work contract or the decision on recruitment, appointment, and assignment of duties of the legal representative of the enterprise;
A certified true copy of the original appointment decision (for those working under the appointment system) or the document recognizing the election results (for those working under the electoral system) of the legal representative of the enterprise or a copy of the enterprise registration certificate (for the case of the legal representative of the sub-lease or labor supply enterprise).

3. The procedure for granting a license for labor subleasing

The enterprise submits a set of dossiers to the Department of Labor – War Invalids and Social Affairs where the enterprise’s head office is located to apply for the license. After verifying the necessary documents, the Department of Labor – War Invalids and Social Affairs issues a receipt specifying the date of receiving the application.

Within 20 working days from the date of receiving the completed and compliant dossier, the Department of Labor – War Invalids and Social Affairs conducts an evaluation and submits it to the Chairman of the provincial People Community for granting the license to the enterprise. In case the dossier is found to be incomplete, the Department of Labor – War Invalids and Social Affairs shall issue a written request to complete it within a period of 10 working days from the date of receiving the dossier.

Within 07 working days from the date of receiving the submitted dossier from the Department of Labor – War Invalids and Social Affairs, the Chairman of the provincial People Community shall verify and grant the license to the enterprise. In case the license is not granted, a written response shall be sent to the enterprise, clearly specifying the reasons for the denial.

Note that if the legal representative has previously been the legal representative of another enterprise whose license was revoked within 05 consecutive years before the application for the license, the enterprise will not be granted the labor subleasing license.

In summary, the implementation of regulations and legal conditions related to labor subleasing operations is not only the responsibility of employers but also the duties of the government and labor management agencies. By establishing high standards for labor benefits, occupational safety, and health, as well as taxation and business regulations, we are building a quality working environment and promoting sustainable development. However, this task does not only stop at granting licenses but also requires constant companionship, monitoring, and inspection from state management agencies. The government and labor management agencies need to regularly assess, update, and enhance legal regulations to adapt to labor market changes and ensure a fair working environment and protect the rights of employees.

Time of writing: 30/06/2023

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