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Eligibility for Severance Allowance

  • Perform: By: Le Thao, Translator: Hoang Duc
  • 30/06/2021

ACDC Centre Law Office advises:

Question: In accordance with the current labor law, what conditions do employees receive when terminating their employment contracts will receive Severance Allowance? Thank you for your advice!

Law Department - ACDC advice:

Pursuant to Article 46 of the Labor Code 2019  on severance allowance, accordingly, the conditions for employees to terminate their employment contracts will receive severance allowances including the following two conditions:

(1) Employees have worked regularly for themselves for 12 months or more.

In particular, the working time to calculate severance allowance is the total time the employee has worked for the employer minus the time the employee has participated in unemployment insurance in accordance with the law on unemployment insurance and the working time has been paid severance allowance by the employer,  Job loss benefits.

(2) When the employment contract is terminated, one of the following:

- Expiration of labor contract, except for cases where the labor contract signed to the end of the term is required for the employee who is a member of the management board of the organization representing the employee at the facility in which the labor contract expires;

- Having completed the work under the labor contract;

- The two parties agree to terminate the labor contract;

- The employee is sentenced to imprisonment but is not entitled to a suspended sentence or does not fall under the case of being released under Clause 5, Article 328 of the Criminal Procedure Code, death or is prohibited from doing the work specified in the labor contract according to the legally effective court judgments or decisions;

- Dead workers; to be declared incompetent by the court for civil acts, missing or dead;

- The employer is a deceased individual; declared by the Court to be incompetent in civil acts, missing or dead. The employer is not an individual who terminates his/her operation or is notified by the specialized business registration agency of the provincial-level People's Committee that there is no legal representative or person authorized to exercise the rights and obligations of the legal representative;

- The employee unilaterally terminates the labor contract as prescribed in Article 35 of the Labor Code 2019;

- The employer unilaterally terminates the labor contract as prescribed in Article 36 of the Labor Code 2019.


If the employee fully meets the above two conditions but falls under one of the following cases, he/she will not be entitled to severance allowance:

- Employees are eligible for pensions in accordance with the Labor Code and the law on social insurance;

- The employee voluntarily quits his/her job without a good reason for 05 consecutive working days or more.


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