TERMINATION OF MEMBERS OF EMPLOYEE ORGANIZATIONS 2025
Topic 17:
TERMINATION OF EMPLOYMENT CONTRACTS WITH EMPLOYEES WHO ARE MEMBERS OF THE EXECUTIVE COMMITTEE OF EMPLOYEE REPRESENTATION ORGANIZATIONS AT THE WORKPLACE WHEN THE CONTRACT EXPIRES
Dr. Đinh Thị Chiến
SUMMARY OF THE CASE AND COURT DECISION
[Judgment No. 21/2019/LĐ-ST dated November 21, 2019, by the People’s Court of Biên Hòa City, Đồng Nai Province]
Case Summary:
Mr. Vương Quốc and Company K signed Employment Contract No. 15/HĐLĐ/KD.14 on April 25, 2015, with a duration of 12 months (expiring on April 25, 2016). During the validity of the contract, the grassroots trade union of Company K was established, and Mr. Vương Quốc was elected Chairman of the Provisional Executive Committee under Decision No. 111/QĐCN-CĐKCN dated November 25, 2015, for a term of 12 months. Consequently, Company K and Mr. Quốc signed Agreement No. 137/HĐLĐ/KD.16 to extend Mr. Quốc’s employment contract until November 25, 2016, explicitly stating, “Extension to the end of the Trade Union Executive Committee term November 25, 2015 – November 25, 2016.”
Moreover, Company K issued several notices to Mr. Quốc and the Industrial Park Trade Union, stating their intention not to renew Mr. Quốc’s contract after the extension period. These included Decision No. 03/2016/QĐNV-KD dated March 24, 2016, letters dated October 24, 2016, November 7, 2016, and Decision No. 05/2016/QĐNV-KD dated November 25, 2016.
Mr. Quốc acknowledged receiving these decisions and notices from Company K regarding the non-renewal of his employment contract. However, the Industrial Park Trade Union continued to include Mr. Quốc in the candidate list for the grassroots Trade Union Executive Committee elections. Mr. Quốc was elected Chairman of the grassroots Trade Union Executive Committee for the 2016–2021 term and was officially recognized under Decision No. 138/QĐCN-CĐKCN issued by the Industrial Park Trade Union on October 27, 2016.
After the extension of the employment contract expired, Company K issued Decision No. 05/2016-QĐNV-KD on November 25, 2016, terminating Mr. Quốc’s contract.
The court determined that on October 24, 2016, when the Provisional Trade Union Executive Committee convened its Congress, Mr. Quốc’s employment contract had only one month remaining. Nonetheless, Mr. Quốc and the Industrial Park Trade Union included him in the candidate list for the grassroots Trade Union Executive Committee elections, which contravened Guidance No. 398/HD-TLĐ dated March 28, 2012, by the Vietnam General Confederation of Labor: “Apart from meeting the standards, candidates for the Executive Committee must fulfill the following conditions: … Regarding re-election to the Executive Committee: Must have sufficient remaining years of service to cover at least half of the term.”
Consequently, Mr. Quốc’s election as Chairman of the grassroots Trade Union Executive Committee for the 2016–2021 term and his recognition under Decision No. 138/QĐCN-CĐKCN dated October 27, 2016, did not meet the standards for candidates and elected persons. After the extended employment contract expired, Company K issued Decision No. 05/2016-QĐNV-KD dated November 25, 2016, terminating Mr. Quốc’s employment contract in accordance with Clause 1, Article 36 of the Labor Code.
Court Decision:
The court rejected Mr. Vương Quốc’s lawsuit request.
COMMENTARY
I. Introduction
Contract expiration constitutes a form of employment termination based on the agreement of the parties at the time the contract is established. Therefore, when an employment contract expires, and no legal events arise, the contract is automatically terminated. However, in cases where the employee is a member of the executive committee of an employee representation organization at the workplace and is still within their term of office, labor laws require the employer to extend the employment contract until the term ends. This legal intervention aims to protect employees engaged in union work or other employee representation organizations at the workplace.
II. Legal Issues
- Termination of Employment Contracts with Employees Who Are Members of the Executive Committee of Employee Representation Organizations When the Contract Expires
Under Clause 1, Article 34 of the 2019 Labor Code, an expired employment contract automatically terminates unless specified otherwise in Clause 4, Article 177 of the 2019 Labor Code. Clause 4, Article 177 of the 2019 Labor Code stipulates: “Employment contracts already entered into must be extended until the end of the term for employees who are members of the executive committee of an employee representation organization at the workplace still serving their term when the employment contract expires.”
In the case described, when the employment contract initially expired on April 25, 2016, Mr. Quốc was the Chairman of the Provisional Trade Union Executive Committee of Company K. Consequently, the parties agreed to extend the contract until November 25, 2016, with a clear provision that the extension would last until the end of the term of the Trade Union Executive Committee. This extension complied with Clause 1, Article 34, and Clause 4, Article 177 of the 2019 Labor Code.
However, before the extended contract expired, Mr. Quốc was elected to the new Trade Union Executive Committee and continued to serve as Chairman for the new term, as recognized under Decision No. 138/QĐCN-CĐKCN issued by the Industrial Park Trade Union on October 27, 2016. When the extended employment contract expired again on November 25, 2016, Mr. Quốc was still Chairman of the grassroots Trade Union for the new term.
Therefore, under Clause 1, Article 34, and Clause 4, Article 177 of the 2019 Labor Code, the employer should have further extended Mr. Quốc’s employment contract until the end of his new term. The termination of Mr. Quốc’s employment contract by Company K on the grounds of expiration, while he was serving as Chairman of the grassroots Trade Union Executive Committee, violated the law.
If Company K believed that Mr. Quốc’s candidacy and election to the Trade Union Executive Committee were unlawful, it would have required a decision from the Industrial Park Trade Union to annul these results before Company K could terminate his employment contract.
The court’s view that Mr. Quốc’s inclusion in the candidate list by the Industrial Park Trade Union and his subsequent election to the grassroots Trade Union Executive Committee violated Guidance No. 398/HD-TLĐ dated March 28, 2012, lacked a comprehensive examination of the provision. Section A, Clause 3 of Guidance No. 398/HD-TLĐ states: “Apart from meeting the standards, candidates for the Executive Committee must fulfill the following conditions: … Regarding re-election to the Executive Committee: Must have sufficient remaining years of service to cover at least half of the term. Cases where the remaining service period is less than half of the term shall be specifically considered by the higher-level trade union and party committee.”
In Mr. Quốc’s situation, his remaining service period (the duration left in the employment contract) was less than half of the term. Hence, the authority to consider this matter belonged to the Industrial Park Trade Union and the same-level party committee.
Company K’s three notices (Decision No. 03/2016/QĐNV-KD dated March 24, 2016; Letters dated October 24, 2016, and November 7, 2016; Decision No. 05/2016/QĐNV-KD dated November 25, 2016) informing the Industrial Park Trade Union of its intention not to renew Mr. Quốc’s contract after the extension merely served as a basis for the Industrial Park Trade Union and same-level party committee to review and decide.
In practice, the Industrial Park Trade Union’s decision to include Mr. Quốc in the candidate list for the new Trade Union Executive Committee election may have stemmed from the grassroots Trade Union’s trust in Mr. Quốc’s union leadership during his previous term. Consequently, Mr. Quốc was elected by the workforce to the new Trade Union Executive Committee and officially recognized by the Industrial Park Trade Union. Thus, Mr. Quốc’s election as Chairman of the grassroots Trade Union Executive Committee for the 2016–2021 term, along with his official recognition under Decision No. 138/QĐCN-CĐKCN dated October 27, 2016, was not inconsistent with Guidance No. 398/HD-TLĐ issued by the Vietnam General Confederation of Labor.
- Employer Interference in Employee Representation Organizations at the Workplace
Clauses 1 and 2, Article 177 of the 2019 Labor Code, mandate the following obligations for employers: (1) Employers must not obstruct or hinder employees from engaging in lawful activities to establish, join, or participate in employee representation organizations at the workplace; (2) Employers must recognize and respect the rights of legally established employee representation organizations at the workplace.
Therefore, does the issuance of four documents by Company K (Decision No. 03/2016/QĐNV-KD dated March 24, 2016; Letters dated October 24, 2016, and November 7, 2016; and Decision No. 05/2016/QĐNV-KD dated November 25, 2016) notifying the Industrial Park Trade Union B of its intent not to renew Mr. Quốc’s employment contract after the extension period constitute a violation of Clauses 1 and 2, Article 177 of the 2019 Labor Code? The evaluation of this issue must consider the reasons for Company K’s decision not to renew Mr. Quốc’s employment contract.
If the non-renewal was based on objective reasons, such as the cessation of Mr. Quốc’s work, Company K’s notification about the non-renewal could serve as a reference for Mr. Quốc and the higher-level Trade Union to decide whether his inclusion in the new Executive Committee would ensure its stability. In this case, such notifications from the employer would not be deemed violations of Clauses 1 and 2, Article 177 of the 2019 Labor Code.
However, if Mr. Quốc’s work remained available, he continued to fulfill his assigned duties, and the company’s decision not to renew the contract stemmed solely from Mr. Quốc’s anticipated participation in the new Trade Union Executive Committee, the employer’s actions could be interpreted as obstructive, hindering employees from engaging in activities of the workplace employee representation organization. This would violate the employer’s obligations under Clause 1, Article 177 of the 2019 Labor Code. Additionally, the termination of Mr. Quốc’s employment contract would reflect a lack of respect for the rights of legally established employee representation organizations at the workplace, thereby contravening the obligations under Clause 2, Article 177 of the 2019 Labor Code.
This analysis underscores that Mr. Quốc’s inclusion in the candidate list for the new Trade Union Executive Committee election was conducted by the Provisional Trade Union at Company K, with the approval of the higher-level Trade Union. Moreover, Mr. Quốc’s election into the new Executive Committee was based on the confidence of trade union members in their representative. By not renewing Mr. Quốc’s employment contract, Company K failed to respect the grassroots Trade Union’s right to select personnel for the Executive Committee and disregarded the higher-level Trade Union’s decision to officially recognize the grassroots Trade Union’s personnel.
III. Conclusion
The protection of employees engaged in collective labor representation work at the workplace is a crucial requirement to strengthen their independence in such activities and to prevent employer interference or discrimination against these employees. The legal provisions mandating the extension of employment contracts for employees who are members of the executive committee of workplace employee representation organizations—when their employment contracts expire but their term has not ended—serve the dual purpose of safeguarding employees engaged in such representation work and ensuring the continuous operation of the executive committee of employee representation organizations at the workplace.
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