Employers face a range of challenges, including rapidly rising benefits costs and the ability to engage, attract, and retain key talent. Explore some job benefits that Vietnamese developers value most with Twendee.
Why do businesses build their remote tech teams in Vietnam?
Fifteen years ago, Vietnam barely had any IT companies, but now the country is bustling with IT activities spanning business intelligence, data analytics, and software development. As Vietnam has set its eyes on becoming the IT nation of the region, it will continue to go through a comprehensive transformation in e-commerce, fintech, EdTech, and more.
Moreover, Vietnam’s driven and skilled IT workforce also makes it a desirable destination for foreign investors looking to build blockchain hubs and R&D departments. As an IT nation, Vietnam shows immense potential to overtake its counterparts as a low-cost yet highly skilled IT outsourcing country.
According to the Vietnam IT Market Report, Vietnam has a sizable tech talent pool of 400,000 engineers while producing 50,000 IT graduates annually. Their impressive talent pool and thriving IT outsourcing industry can be attributed to their strong emphasis on STEM education combined with their IT-specialized schools.
Ranked 2nd in the Asia Pacific from the Global Skills Index 2020 for their technology skills, Vietnamese developers possess high-tech, world-class skills that are globally acclaimed. They particularly excelled in operating systems, computer networking, and human-computer interaction, among many other skills.
Which job benefits do Vietnamese developers value most?
Opportunities for career growth
Under the impact of globalization and digitalization, we all see the rapid development of IT. This allows developers to secure well-paying jobs with high salaries and job benefits. With companies looking only for top talent to build their remote tech teams, tech talent is pressured to keep up with trends and constantly improve themselves to advance in their jobs.
This means that clear growth opportunities play an important role in attracting the attention of Vietnamese developers, and they are more likely to accept job offers that will advance their career path. more theirs. For example, junior tech talent will seek jobs that can help them advance within the organization, progressing to senior roles and eventually leading to management positions.
On the other hand, senior developers will prefer jobs that have interesting projects and good challenges to develop their skills while building their network.
A Well-Deserved Pay Rate
From our research, the average pay rate for Vietnamese developers can be divided into 4 different levels based on their experience and level:
- Intern/Student: Little knowledge of the language or tech stack. Limited or no professional programming experience.
- Fresher/Entry Level/Junior: Little or some knowledge of the language or tech stack
- Experienced (non-manager): strong knowledge of the language or tech stack.
- Tech Lead/Manager: Mastery of the language or tech stack
According to statistics from Vietnamese workers in 2022, the developer salary rate can be sustainable depending on their tech positions.
It is also worth noting that Vietnamese developers expect a net salary offer when considering working for a company. Thus, we recommend businesses always be transparent about the salary offer, whether it is gross or net.
Furthermore, Vietnamese tech talents now expect an approximately 7% ~ 15% salary increment annually. So we recommend companies beef up their offer with a 15–20% higher than the average pay for developers in Vietnam.
Appealing Work Environment
Junior-level candidates care about how to advance their career path. They want to join a team with a clear structure and a professional environment where they can learn important skills. In addition, they would prefer an engaging workplace where everyone is treated like a team player instead of just a code writer or a second-class employee who’s outside of the office orbit in a remote setting.
Senior-level candidates care about job benefits, welfare, the tech stack, and stability. They understand their value and are looking for a “fair” working environment that matches their worth. Hence, we recommend businesses also share more about employee compensation and welfare policies with the candidates.
Working hours and overtime
The Vietnamese workday is deemed to be eight hours long, with a workweek of 48 hours.
Overtime may be permitted in the employment contract but cannot exceed four hours per day, 40 hours per month, or 200 hours annually. Some industries have exceptions and allow up to 300 hours of overtime a year.
Any overtime hours rendered during daytime hours are paid at 150% of the base rate on weekdays and 200% on weekends. Overtime hours rendered during public holidays (or paid leave periods) are paid at 300% of the base rate. Any overtime that is rendered during nighttime hours is subject to an extra 30%.
Note that some employees cannot request overtime, namely women in their seventh month of pregnancy or parents with children under one year old.
Social security contributions
In Vietnam, social security contributions go to three funds: social insurance, health, and unemployment.
As an employer, you are responsible for contributing 17.5% of your employee’s salary to social insurance, 3% to health insurance, and 1% to unemployment. Your employees are likewise required to contribute 8%, 1.5%, and 1%, respectively.
In some cases, foreign employers may not be required to contribute to social insurance and unemployment funds.
Paid leave
Employees in Vietnam are entitled to a minimum of 12 paid vacation days each year. They are also entitled to an extra paid day for every five years served under the same employer.
Note that employees who work in hazardous environments are entitled to an extra 2 to 4 days of paid leave each year.
Maternity and paternity leave
New mothers are entitled to 100% pay for six months of maternity leave (including two months’ worth of salary in a lump sum), or between 10 and 50 days in case of miscarriage or termination of pregnancy.
New fathers are granted five to 14 days of paid leave, depending on the circumstances, such as the type of birth and the number of children.
Notice of termination and proper severance
In cases of termination, you are required to provide 30 days’ notice for fixed-term contracts and 45 days for indefinite contracts. Severance pay is typically two weeks’ worth of base salary for every year of tenure, or, if the termination is related to technological or structural changes within your business, a month’s full salary.
Common job benefits in Vietnam
You should also understand which job benefits are offered as standard in Vietnam. These are not necessarily required by law, but candidates will expect you to provide them. They include:
- Holiday bonuses
- Allowances and stipends for housing and commuting
- Health fringe benefits like club memberships
- Additional coverage for health and life insurance
Supplemental job benefits to consider for Vietnamese employees
The job benefits listed so far are either mandated by law or expected as a bare minimum. However, to attract and retain the best talent—and get a leg up on your competitors—you need to go beyond the basic requirements. This is where supplemental job benefits come into play.
A robust, modern job benefits stack can be a key decision-maker for potential hires and ensure that your existing employees feel valued and motivated at your company.
Some of the most attractive job benefits you can offer your Vietnamese workforce include:
Supplemental Insurance
Vietnam’s mandatory insurance contributions only cover health and unemployment. You can supplement these with personal and disability insurance, as well as additional perks and benefits.
To provide this benefit, you will typically need to work with a private HMO provider on top of the relevant government agencies.
Stipends and development programs
While housing allowances and transportation stipends are common in Vietnam, your employees will either be telecommuting or working from home full-time.
Focus on aligning your allowances and stipends to support this unique working arrangement. For example, you can cover (or partially cover) home office supplies and equipment or work with local coworking businesses to provide monthly allowances.
Additional soft job benefits
You don’t need to break the bank to offer appealing, valuable job benefits, especially if you’re a small business. You can easily customize soft, remote-tailored benefits, such as:
- Flexible work hours. Genuine flexitime is invaluable for remote employees. A flexible or asynchronous schedule allows them to schedule their lives more efficiently and ensures that they don’t have to work unsocial hours to align with a global team.
- Opportunities for growth Globally distributed teams are, by nature, more diverse. This can easily become a selling point for remote employees who are interested in working with teammates from different cultures and with different viewpoints and developing their soft and hard skills.
These kinds of job benefits provide long-term value and reflect positively on your employer’s brand. They show potential hires and existing employees that you are focused on investing in their engagement and are in tune with what makes their working situation unique.
How to set up and manage job benefits for Vietnamese employees
Once you’ve decided what your job benefits stack is going to look like for your Vietnamese workforce, you need to put the wheels in motion. This is where things can start to get tricky.
First, you need to walk the tightrope between your employees’ needs and your in-house resources. If you’re a smaller organization trying to scale through outsourcing, you can easily get bogged down in costly benefit packages.
And then there’s the issue of compliance. If you accidentally fall foul of the rules along the way, you can incur fines and penalties and significantly damage your growth.
When you then factor in the process of setting up payroll, managing leave entitlements, and getting to grips with the whole whirlpool of tax consequences and obligations, well, it can all start to get a little daunting.
This is why it’s a good idea to let a global employment services provider, like Remote, do all the heavy lifting for you.
In particular, our employer of record (EOR) service allows you to quickly and conveniently manage all the intricacies of your Vietnamese operation, including:
- Organizing payroll and leave
- Distribution of local employment taxes
- Maintaining compliance with statutory and supplementary job benefits
- Offering competitive global compensation packages
- Scaling your team
All you have to do is focus on hiring the right people for your organization, and our team of local, in-house, on-the-ground experts will guide you the rest of the way.
Job benefits underpin talent acquisition and retention
Finally, identifying an appropriate package of job benefits can dramatically improve your attempts to get talent in Vietnam. It’s a task that can pay off significantly in the short term, and with a little help, it’s not that difficult.
Establishing and fine-tuning these benefits with certainty helps to create a compelling employee value proposition. This can really pay off over the medium to long term.
As a company attempting market entry, you’ll need to strike a balance between creating expectations and competing in the local market. It can be difficult to offer a comprehensive range of employee benefits, particularly for your company’s early hires in Vietnam. It’s better to focus on the areas that you can genuinely offer and deliver.
job benefitstech talentsvietnamese developersVietnamese Tech Talents And Software Developers
What do you think?