Are contract workers entitled to severance pay when restructuring the organization?

Reply:Regarding this issue, contract workers are not entitled to severance pay under Decree 178/2024/ND-CP because the subjects of regulation of the Decree are cadres, civil servants and public employees working in the public sector when they quit their jobs (retirement and termination of employment).

Contract workers are subjects regulated by the Labor Code, are people who work for employers according to an agreement, are paid and are subject to the management, operation and supervision of the employer (according to Clause 1, Article 3 of the 2019 Labor Code).

According to Article 1 of Decree 178/2024/ND-CP amended and supplemented by Clause 1, Article 1 of Decree No. 67/2025/ND-CP, Decree 178 stipulates the subjects of regulation including:

- Retired people (early retirement and resignation)

- People elected or appointed to leadership or management positions with lower position allowances or who cease to hold leadership or management positions

- Cadres, civil servants and public employees increase business trips to the grassroots level

- People with outstanding qualities and abilities

- Cadres, civil servants, public employees after arrangement

- Cadres, civil servants, public employees and workers in agencies, organizations, public service units of the Party, State, Vietnam Fatherland Front, socio-political organizations and associations assigned by the Party and State from central to district levels, cadres, civil servants at commune level, armed forces (including the People's Army, People's Police and cryptography) in the implementation of reorganization of apparatus, administrative units at all levels, streamlining of payroll, restructuring and improving the quality of cadres, civil servants and public employees in the political system, including:

Agencies of the Communist Party of Vietnam, the State, the Vietnam Fatherland Front, socio-political organizations at the central, provincial and district levels (hereinafter referred to as agencies and organizations from the central to district levels) and armed forces.

Administrative organizations of agencies and organizations from central to district level directly carry out organizational restructuring or do not directly carry out organizational restructuring but carry out staff streamlining, restructuring and improving the quality of cadres and civil servants.

Public service units directly carry out organizational restructuring or do not directly carry out organizational restructuring but carry out staff streamlining, restructuring and improving the quality of civil servants, including:

+ Units belonging to the organizational structure of agencies and organizations from central to district level and administrative organizations of agencies and organizations from central to district level;

+ Units under provincial and municipal Party Committees directly under the Central Government and district, town, county and municipal Party Committees under provinces and centrally run cities; under provincial and district People's Committees; under socio-political organizations at the provincial level.

Other remaining public service units (not specified in Clause 3 of this Article) shall complete the organizational arrangement within 12 months from the date of the arrangement decision of the competent authority.

Agencies, organizations and units are arranged by administrative units at all levels.

The associations assigned by the Party and State at the central, provincial and district levels carry out the arrangement, consolidation and merger of organizational apparatus.

Thus, you should base on the above regulations to determine whether you are entitled to the benefits under Decree 178 or not.