What Should Vietnamese Workers Do When Their Company Shuts Down and Owes Wages?
In the context of economic fluctuations, many businesses face difficulties and are forced to suspend operations. However, a concerning issue is that many employees are left unpaid without clear communication, leading to prolonged disputes. So, what should employees do to protect their legal rights when owed wages?
The Right to Wages Is a Mandatory Obligation of Employers
According to the 2012 and 2019 Labor Codes (effective from January 1, 2021), wages are mandatory payments from employers to employees in exchange for their work. These payments are not only a contractual obligation but also a minimum entitlement that cannot be denied, delayed, or arbitrarily reduced.
Citing financial difficulties as a reason to delay or withhold wages while still requiring employees to work is a legal violation and may lead to serious legal consequences if the employee files a lawsuit.
Employees Can File a Lawsuit if They Are Owed Wages
When negotiation fails, workers have the right to use legal means to protect their interests. Current regulations require a mediation step before bringing a lawsuit to court. However, if the employer is absent or uncooperative, this becomes grounds for lawful litigation. Understanding the legal process from the beginning helps employees save time and avoid being disadvantaged.
Submit a Mediation Request to the Department of Labor, War Invalids and Social Affairs
This is the initial step in resolving individual labor disputes. Mediators assist both parties in finding a mutual solution. If one party is absent or if mediation fails, employees may proceed to sue in the competent People’s Court.
File a Lawsuit in Court
If there is sufficient evidence—such as labor contracts, pay slips, HR confirmations, or email exchanges—the employee can request the court to force the company to pay the outstanding wages.
In a typical case heard in Ho Chi Minh City, the court accepted the employee’s claim and ordered the company, which had ceased operations without paying wages, to make full payment—even though the company did not attend the mediation or trial.
Legal Tips for Effectively Claiming Unpaid Wages
To ensure their rights are protected, employees must prepare thoroughly in terms of legal procedures and documentation. In practice, lack of evidence or improper legal steps often result in prolonged or rejected cases.
Gather Complete Evidence of Work and Wages
Important documents include employment contracts, recruitment decisions, pay slips, timesheets, work emails, and confirmations from HR or colleagues—these are crucial for the court to establish the employment relationship and wage obligations.
Send an Official Payment Request to the Company
Even if the company has suspended or ceased operations, the employee should still send a formal request for wage payment. This shows goodwill and starts the litigation process.
Follow Legal Procedures
If mediation fails due to the company's absence or non-cooperation, the employee can file a lawsuit directly. Legal counsel is highly recommended for accurate preparation of documents and proper legal compliance.
Request Enforcement If the Company Does Not Voluntarily Pay
If the company fails to comply with a court ruling, employees may ask the Civil Judgment Enforcement Department to enforce the company’s assets to recover wages.
Additional Benefits Employees May Claim
In addition to unpaid wages, employees may also claim:
Interest on Late Payments
As per the Civil Code, interest may be applied to late payments, compensating for financial losses over time.
Compensation for Damages
If the company shuts down without notice, causing losses (missed income, job opportunities, extra expenses), the employee may claim compensation.
Wages are a fundamental and mandatory right that employers must fulfill. When unpaid, employees should proactively follow the legal process to protect their interests. If professional assistance is needed, working with a competent law firm is a wise and effective choice.
Are you being owed wages or facing a labor dispute?
Let DEDICA LAW FIRM assist you. With extensive experience in labor disputes and litigation, we are committed to protecting your rights to the fullest.
📞 Hotline: (+84) 39 969 0012 (Support via WhatsApp, WeChat, Zalo)
🏢 Head Office: 144 Vo Van Tan St., Vo Thi Sau Ward, District 3, Ho Chi Minh City
🕒 Working hours: Monday – Friday (8:30 AM – 6:00 PM)
Contact us now for a free initial legal consultation with our professional legal team!
