{"id":10328,"date":"2024-08-16T09:08:18","date_gmt":"2024-08-16T02:08:18","guid":{"rendered":"https:\/\/cdlaf.vn\/?p=10328"},"modified":"2024-08-16T11:15:07","modified_gmt":"2024-08-16T04:15:07","slug":"is-on-behalf-salary-payment-for-employees-a-service-or-a-support-activity","status":"publish","type":"post","link":"https:\/\/cdlaf.vn\/en\/is-on-behalf-salary-payment-for-employees-a-service-or-a-support-activity\/","title":{"rendered":"Is on-behalf salary payment for employees a service or a support activity?"},"content":{"rendered":"<p>The on-behalf salary payment activity is now common and is offered by many human resources service companies as a solution for employers in managing employee wages. It helps employers to be more proactive in processing payroll payments for employees and reducing administrative burdens since payroll work periodically consumes a lot of time for the HR department. However, the popularity of this activity also raises related legal issues, as the on-behalf salary payment activity is conducted by an intermediary unit, which will receive from the employer and pay the employee the wages.<\/p>\n<p>This article will provide some basic approaches to analyze the legality of this activity.<\/p>\n<figure id=\"attachment_10310\" aria-describedby=\"caption-attachment-10310\" style=\"width: 600px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-10310 size-medium\" src=\"http:\/\/cdlaf.vn\/wp-content\/uploads\/2024\/08\/pexels-karolina-grabowska-4386339-1-600x400.jpg\" alt=\"\" width=\"600\" height=\"400\" srcset=\"https:\/\/cdlaf.vn\/wp-content\/uploads\/2024\/08\/pexels-karolina-grabowska-4386339-1-600x400.jpg 600w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2024\/08\/pexels-karolina-grabowska-4386339-1-1200x800.jpg 1200w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2024\/08\/pexels-karolina-grabowska-4386339-1-768x512.jpg 768w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2024\/08\/pexels-karolina-grabowska-4386339-1-1536x1024.jpg 1536w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2024\/08\/pexels-karolina-grabowska-4386339-1.jpg 1680w\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" \/><figcaption id=\"caption-attachment-10310\" class=\"wp-caption-text\">Source: pexels-karolina-grabowska-4386339<\/figcaption><\/figure>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_83 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of contents:<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #a32411;color:#a32411\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #a32411;color:#a32411\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/cdlaf.vn\/en\/is-on-behalf-salary-payment-for-employees-a-service-or-a-support-activity\/#1_General_regulations_governing_on-behalf_collection_and_payment_services\" >1. General regulations governing on-behalf collection and payment services<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/cdlaf.vn\/en\/is-on-behalf-salary-payment-for-employees-a-service-or-a-support-activity\/#2_Regulations_on_salary_payment_mechanism_of_an_authorized_representative_for_employees_when_receiving_salary\" >2. Regulations on salary payment, mechanism of an authorized representative for employees when receiving salary<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"1_General_regulations_governing_on-behalf_collection_and_payment_services\"><\/span>1. General regulations governing on-behalf collection and payment services<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>On-behalf collection and payment activity has been taking place for a long time as a support activity from service companies for their clients. Normally, accounting service companies or logistics service companies will support foreign clients using their services in receiving\/paying the clients&#8217; partners in Vietnam, and then paying\/receiving the corresponding amount of money from their customers. Accordingly, the support companies implement this activity without charging service fees. Regarding applicable regulations, they do not provide specific restrictions on the above activities, and the adjustment instructions are often scattered in the tax authorities&#8217; guiding documents on invoice issuance.<\/p>\n<p>However, the situation shall change entirely if this activity is offered as a fee-based service. Decree 52\/2024\/ND-CP on non-cash payments classifies on-behalf collection and payment services under both (i) Payment services through the client\u2019s payment account and (ii) Payment services not through the client&#8217;s payment account. Under Circular 15\/2024\/TT-NHNN, collection, and payment on-behalf services are specifically defined and must be provided by payment service providers, such as:<\/p>\n<ul>\n<li>State Bank of Vietnam<\/li>\n<li>Commercial banks, policy banks, cooperative banks, foreign bank branches;<\/li>\n<li>People&#8217;s credit funds, microfinance organizations;<\/li>\n<li>Enterprise providing public postal services.<\/li>\n<\/ul>\n<p>Thus, it can be seen the subjects that can provide collection and payment services are limited, and mainly belong to credit institutions. Aside from these subjects, the current law does not have additional regulations on the subjects that can provide collection and payment services. It should be noted that Decree 52\/2024\/ND-CP has listed &#8220;Providing payment services without being a payment service provider&#8221; in the list of prohibited acts under this Decree. Therefore, if not the above subjects, enterprises cannot provide on-behalf collection and payment services.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"2_Regulations_on_salary_payment_mechanism_of_an_authorized_representative_for_employees_when_receiving_salary\"><\/span>2. Regulations on salary payment, mechanism of an authorized representative for employees when receiving salary<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>As analyzed above, the on-behalf collection and payment services are currently performed by certain subjects according to regulations. However, it is common to encounter advertisements about the on-behalf salary payment activity from human resource service companies. Accordingly, these companies often integrate salary payment on-behalf activity into client support activities without recording specific unit prices, leading to difficulty in considering this as the on-behalf collection and payment service mentioned above.<\/p>\n<p>Within the scope of business activities, VSIC code 7830: Human resources supply and management is commonly registered by human resources service companies. Accordingly, the description of this industry, as stipulated in Decision 27\/2018\/QD-TTg, may relate to the on-behalf salary payment activity, specifically:<\/p>\n<p><em>\u201cActivities of providing long-term, stable labor resources, managing domestic labor resources, <strong>representing workers in cases related to salary payments, taxes<\/strong> and financial or labor resources issues, but they do not have the responsibility to direct and supervise workers.\u201d<\/em><\/p>\n<p>Thus, if we consider the content of the description alone, it can be understood that representing employees in matters of salary and tax payment is very broad, including representing the declaration and payment of personal income tax, or representing the receipt of salary from the employer and paying this salary back to the employee based on the employee&#8217;s approval of representing the resolution of the above issues. However, the current law does not have detailed regulations on the above description, so it is difficult to confirm whether the above understanding is appropriate or not.<\/p>\n<p>However, the actual practice of the on-behalf salary payment activity in the market differs from the aforementioned understanding. Accordingly, this activity is based on an agreement between the human resource service provider and the employer, rather than an authorization agreement between the employee and the human resource service provider. In other words, the employer retains the authority to determine how the employee is paid, not the employee. Consequently, the employer and the human resource service provider rarely obtain the employee\u2019s consent for the on-behalf salary payment. From the employees\u2019 perspective, they primarily prioritize receiving their full salary on time, rather than the specific payment method. Nevertheless, this discrepancy can still be considered an issue, as per the provisions of Article 94.1 of the Labor Code:<\/p>\n<p><em>\u201cEmployers must pay the wage in full and on time and <strong>directly<\/strong> to the employee. If an employee is <strong>unable to receive his or her wage directly<\/strong>, then the employer may pay same to another person <strong>lawfully authorized by such employee\u201d<\/strong>.<\/em><\/p>\n<p>Therefore, the Labor Code has recognized the mechanism of authorization, allowing employees to authorize a representative to receive their salary on their behalf. This provision is quite similar to the understanding of the VSIC 7830 description mentioned above. In conclusion, to receive salary on behalf of an employee, a valid authorization from the employee is required.<\/p>\n<p>Based on the above analysis, it can be seen that there are still ambiguities in the on-behalf salary payment activity for employees, particularly regarding whether it should be considered a service or merely a support activity when providing other services. Moreover, the implementation of on-behalf salary payment requires the approval of the employees, not the employers. Therefore, human resource service companies need to pay attention to legal regulations and exercise caution when performing salary disbursement activities.<\/p>\n<p><strong><em>Time of writing:<\/em><\/strong> 09\/08<em>\/2024<\/em><\/p>\n<p><em>The article contains general information which is of reference value, in case you want to receive legal opinions on issues you need clarification on, please get in touch with our Lawyer \u00a0at\u00a0 <a href=\"https:\/\/mail.google.com\/mail\" target=\"_blank\" rel=\"noopener\"><strong>info@cdlaf.vn<\/strong><\/a><\/em><\/p>\n<div class=\"content-post-nd\">\n<div style=\"text-align: center;\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-5519 size-full aligncenter\" src=\"http:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG.png\" alt=\"\" width=\"1080\" height=\"600\" srcset=\"https:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG.png 1080w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG-720x400.png 720w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG-768x427.png 768w\" sizes=\"auto, (max-width: 1080px) 100vw, 1080px\" \/><\/div>\n<\/div>\n<div class=\"content-post-nd\">\n<p><strong>Why choose CDLAF\u2019s service?<\/strong><\/p>\n<ul class=\"li-content\">\n<li>We provide effective and comprehensive legal solutions that help you save money and maintain compliance in your business;<\/li>\n<li>We continue to monitor your legal matters even after the service is completed and update you when there are any changes in the Vietnamese legal system;<\/li>\n<li>Our system of forms and processes related to labor and personnel is continuously built and updated and will be provided as soon as the customer requests it;<\/li>\n<li>As a Vietnamese law firm, we have a thorough understanding of Vietnam&#8217;s legal regulations, and grasp the psychology of employees, employers, and working methods at competent authorities;<\/li>\n<li>CDLAF&#8217;s team of lawyers has many years of experience in the field of labor and enterprises, as well as human resources and financial advisory.<\/li>\n<li>Strict information security procedures throughout the service performance and even after the service is completed.<\/li>\n<\/ul>\n<\/div>\n<p><strong style=\"color: #a32411;\">You can refer for more information:<\/strong><\/p>\n<ul>\n<li><a href=\"https:\/\/cdlaf.vn\/en\/summary-of-questions-by-foreign-investors-when-restaurant-business-in-vietnam\/\">Summary of questions by foreign investors when restaurant business in Vietnam<\/a><\/li>\n<li><a href=\"https:\/\/cdlaf.vn\/en\/which-information-of-employees-is-understood-as-personal-data\/\">Which information of employees is understood as personal data?<\/a><\/li>\n<li><a href=\"https:\/\/cdlaf.vn\/en\/obligations-of-parties-involved-in-personal-data-processing-under-decree-13-2023-nd-cp\/\">Obligations of parties involved in personal data processing under Decree 13\/2023\/ND-CP<\/a><\/li>\n<\/ul>\n\n<div class=\"wpcf7 no-js\" id=\"wpcf7-f2681-o1\" lang=\"en-US\" dir=\"ltr\" data-wpcf7-id=\"2681\">\n<div class=\"screen-reader-response\"><p role=\"status\" aria-live=\"polite\" aria-atomic=\"true\"><\/p> <ul><\/ul><\/div>\n<form action=\"\/en\/wp-json\/wp\/v2\/posts\/10328#wpcf7-f2681-o1\" method=\"post\" class=\"wpcf7-form init\" aria-label=\"Contact form\" novalidate=\"novalidate\" data-status=\"init\">\n<fieldset class=\"hidden-fields-container\"><input type=\"hidden\" name=\"_wpcf7\" value=\"2681\" \/><input type=\"hidden\" name=\"_wpcf7_version\" value=\"6.1.6\" \/><input type=\"hidden\" name=\"_wpcf7_locale\" value=\"en_US\" \/><input type=\"hidden\" name=\"_wpcf7_unit_tag\" value=\"wpcf7-f2681-o1\" \/><input type=\"hidden\" name=\"_wpcf7_container_post\" value=\"0\" \/><input type=\"hidden\" name=\"_wpcf7_posted_data_hash\" value=\"\" \/>\n<\/fieldset>\n<h2 class=\"tt-form\">SEND CONSULTATION REQUEST\n<\/h2>\n<p><label>Full name<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"full-name\"><input size=\"40\" maxlength=\"400\" class=\"wpcf7-form-control wpcf7-text wpcf7-validates-as-required\" aria-required=\"true\" aria-invalid=\"false\" value=\"\" type=\"text\" name=\"full-name\" \/><\/span><br \/>\n<label>Email<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"email\"><input size=\"40\" maxlength=\"400\" class=\"wpcf7-form-control wpcf7-email wpcf7-validates-as-required wpcf7-text wpcf7-validates-as-email\" aria-required=\"true\" aria-invalid=\"false\" value=\"\" type=\"email\" name=\"email\" \/><\/span><br \/>\n<label>Phone Number<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"phone\"><input size=\"40\" maxlength=\"400\" class=\"wpcf7-form-control wpcf7-tel wpcf7-text wpcf7-validates-as-tel\" aria-invalid=\"false\" value=\"\" type=\"tel\" name=\"phone\" \/><\/span><br \/>\n<label>Message<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"coment\"><textarea cols=\"40\" rows=\"10\" maxlength=\"2000\" class=\"wpcf7-form-control wpcf7-textarea\" aria-invalid=\"false\" name=\"coment\"><\/textarea><\/span><br \/>\n<input class=\"wpcf7-form-control wpcf7-submit has-spinner btn-yellow\" type=\"submit\" value=\"Send\" \/>\n<\/p><div class=\"wpcf7-response-output\" aria-hidden=\"true\"><\/div>\n<\/form>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>The on-behalf salary payment activity is now common and is offered by many human resources service companies as a solution for employers in managing employee wages. It helps employers to be more proactive in processing payroll payments for employees and reducing administrative burdens since payroll work periodically consumes a lot of time for the HR&#8230;<\/p>\n","protected":false},"author":4,"featured_media":10310,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[64],"tags":[],"class_list":["post-10328","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles"],"acf":[],"_links":{"self":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/posts\/10328","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/comments?post=10328"}],"version-history":[{"count":0,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/posts\/10328\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/media\/10310"}],"wp:attachment":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/media?parent=10328"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/categories?post=10328"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/tags?post=10328"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}