New government decree outlines requirements, legal validity of ELCs
In Vietnam, the concept of electronic labor contracts (ELCs) is not new, as ELCs are expressly recognized and accorded full legal validity under the prevailing Labor Code. ELCs were anticipated to offer substantial advantages for both employees and employers by cutting down time and costs, while simultaneously enhancing efficiency in human resources management and record-keeping processes. However, five years following its official introduction, the widespread implementation of ELCs appears to have been constrained, primarily due to the lack of comprehensive and clear legal guidance.
In order to resolve these challenges and establish uniform requirements and processes for concluding ELCs, on 24 December 2025, the Government has issued Decree No. 337/2025/ND-CP on ELCs, which officially took effect on 1 January 2026 (Decree 337). Through its five chapters and 30 articles, Decree 337 provides detailed guidance on the requirements, procedures, and legal validity of ELCs, aiming to promote their wider adoption, improve efficiency in human resources management, and ensure legal certainty for both employers and employees.
Defining ELCs and introducing a new concept of nationwide platform
Decree 337 provides the definition of ELCs as a labor contract that is concluded and established in the form of a data message in accordance with the provisions of labor law and electronic transactions law, carrying the same legal validity as a paper-based labor contract. Through this definition, Decree 337 emphasizes the legal value of ELCs and recognizes their validity as same as the traditional paper-based labor contract. Building on this foundation, Decree 337 provides clearer and more detailed regulations on the methods for concluding and performing ELCs.
Notably, ELCs platform (Platform) has been introduced for the very first time. The Platform constitutes a large-scale electronic transaction information system that is built, operated, and managed by the Ministry of Home Affairs. Its functions include the centralized management of nationwide labor contract data and the provision of shared services to agencies, organizations, enterprises, cooperatives, households, and individuals nationwide. The Platform shall be officially put into operation no later than 1 July 2026.
Conditions and method of ELCs conclusion
In principle, Decree 337 requires that the conclusion and implementation of ELCs shall comply with the legal regulations on labor, electronic transactions, cybersecurity, data, data protection, storage and other relevant regulations. ELCs must be sent to employees and employers in the form of data messages via appropriate electronic means as agreed by both parties. Additionally, Decree 337 encourages the maximum usage of ELCs in lieu of paper-based labor contracts for human resources management, as well as for administrative procedures relating to labor contracts.
The parties involved in the conclusion and implementation of ELCs include: (i) employees; (ii) employers; and (iii) eContract system service providers. The eContract system service providers are entities that operate information systems supporting electronic transactions for the conclusion and performance of ELCs Such eContract system service providers serve as an intermediary entity participating in the process of concluding and performing ELCs by providing support services, i.e., facilitating software for the conclusion and implementation of ELC, enabling the parties to create, sign, store, retrieve, and manage ELC.
Decree 337 requires the ELCs to be concluded through eContract system that fully satisfies statutory requirements. Pursuant thereto, the employer and the employee execute the ELC via eContract system by using digital signatures in compliance with the requirements prescribed by electronic transaction laws. Additionally, the execution of the ELC via eContract system shall have appropriate security and technical measures to protect information of such ELC, together with the business continuity and system recovery in the event of incidents, and ensure standardized API connectivity with the Platform in accordance with the Ministry of Home Affairs’ regulations. This requirement ensures accurate identification of the signatory, the association of the signature with the contract data, the signatory’s control at the time of signing, and the ability to detect any post-signature alterations, thereby providing security and legal validity. In addition, Decree 337 provides that each ELC must be assigned a specific ID, which is automatically issued by the Platform, to ensure the uniqueness of the ELC. Within 24 hours from the time the last party signs the contract, the eContract system service providers shall transmit the ELC to the Platform for assignment of an ID. This ID serves as the basis for retrieving, comparing, reporting, and verifying information related to the ELC on the Platform.
Effectiveness of ELCs
Under the applicable Labor Code, the labor contract takes effect from the signing date, unless otherwise agreed by the parties or provided by law. In contrast to paper-based labor contracts, establishing the precise time of conclusion in an electronic environment is inherently more complex, as the transmission of data among the parties may result in signatures being affixed at different times. Accordingly, to ensure compliance with the general rules on determining the effective date of labor contracts and to reflect the particular characteristics of ELC, Decree 337 provides that an ELC shall take effect at the time when the last party executes it, unless the parties agree otherwise.
Modification, suspension, termination and transition of ELC
To ensure the legal validity of these electronic documents, Decree 337 sets forth the applicable methods and conditions in two scenarios: (i) where the original labor contract was an ELC; and (ii) where the original labor contract was paper-based. Particularly:
- For (i), any subsequent amendments, supplements, suspensions, or terminations must be carried out using the same electronic method, unless otherwise agreed by the parties.
- For (ii), the original paper-based labor contract must first be converted into an ELC. The conversion process requires that the electronic identification of both the employee and the employer who entered into such paper-based labor contract must first be authenticated in accordance with the electronic identification and authentication laws, then, the original labor contract shall be converted into a data message with a specific ID. Of note, the data message resulting from the conversion must be digitally signed by an authorized representative of the employer to attest to its accuracy and completeness in relation to the original document, and to assume legal responsibility for the content of the converted message. Subsequent amendments, supplements, suspensions, or terminations of the contract after conversion shall then follow the same procedures applicable to the conclusion of ELCs as provided in Decree 337. Notably, the execution and performance of ELCs shall be carried out in accordance with this Decree from 1 July 2026. As a transitional period, ELCs executed prior to the effective date of Decree 337 and remaining valid as of Decree 337’s effective date, i.e., 1 January 2026, shall continue to be performed in accordance with labor laws and electronic transaction laws until their expiration. Such ELCs shall have legal validity equivalent to the ELCs that satisfy the conditions and methods as prescribed under Decree 337.
In summary, Decree 337 is expected to generate significant benefits, including shortening recruitment timelines and enhancing operational efficiency for enterprises; facilitating clearer access to contract terms and safeguarding employees against loss or unauthorized amendments of contracts; and supporting government authorities in labor management.
Vu Le Bang is a Partner and Nguyen Thi My An is an Associate at Nishimura & Asahi in Ho Chi Minh City.
