Nowadays, electronic labor contracts are gradually replacing traditional-form labor contracts. As a result, electronic signatures are becoming more popular because they can assist parties in signing the labor contract at the appropriate time in circumstances where traditional-form signatures are not possible. Therefore, holding the obligations when using digital signatures in labor contracts will help both the employees and the employers to ensure the validity of the labor contract that they sign.
Vietnam’s new Law on Electronic Transactions No. 20/2023/QH15 was promulgated by the National Assembly on June 22, 2023. It will replace the existing Law on Electronic Transactions No. 51/2005/QH11 when it enters into effect on July 1, 2024. The LOET 2023 aims to facilitate transactions carried out in an electronic environment in all sectors. Derived from the fundamental principles of the Law on Electronic Transactions 2005, the Law on Electronic Transactions 2023 is similarly considered a framework law, developed based on the Model Law on E-Commerce of the United Nations Commission on International Trade Law (UNCITRAL).
Applicable law
- Law on Electronic Transactions 2023
- Decree 48/2024/ND-CP amend Decree 130/2018/ND-CP detailing Law on E-Transactions regarding digital signatures and digital signature authentication services
1. What is an electronic labor contract?
Labor Code 2019 has governed provisions regarding electronic labor contracts. Accordingly, in addition to text and speech, the labor contract can also be expressed in the form of electronic data messages. Their value remains as the written labor contracts.
The electronic labor contract can be defined as follows:
- is an agreement between the employer and the employee regarding employment and the rights and obligations of each party in the labor relation;
- the content of the labor contract is created, sent, received, and stored using one of the electronic means such as telephone, fax, Internet, etc. to establish labor relation; and
- signed by the electronic signatures of the contracting parties.
In which electronic signatures can be created in the form of words, letters, numbers, symbols, sounds, or other forms by electronic means. In fact, parties in the labor contract can use the electronic signature in one of three common ways: digital signature, photo signature, or scanning signature.
As a result, employers can use digital signatures to sign labor contracts with their employees. To ensure the validity of electronic labor contracts signed by digital signatures, users should be aware of the legal value of digital signatures.
2. Legal validity of a digital signature
A digital signature is a form of electronic signature. A digital signature must meet the following conditions:
- The digital signature is created during the validity period of digital certificates and is verified using the public key recorded on such valid digital certificates;
- The digital signature is created by using the private key corresponding to the public key recorded on digital certificates issued by one of the competent organizations providing digital signature authentication services; and
- The private key is only under the control of the signer at the time of signing.
Although e-signature certification service providers widely recognize a digital signature and has high confidentiality and data integrity, it is only used by businesses to file customs declarations and declare and pay taxes online, particularly when issuing e-invoices and conducting online banking transactions.
Applying digital signatures to electronic labor contracts does not appear to be viable at this time, according to the assessment of the practical application of e-signatures, because the number of employees who have their own digital signatures is still quite small. Currently, if an employer wants to sign a labor contract with an employee using a digital signature, the employee who does not have a digital signature will need to print the contract out and sign it. This results in a “half-half” labor contract, which is half paper and half electronic.
3. Employers’ obligations when using digital signatures in labor contracts
Employers have the following obligations:
- Taking measures to avoid the unauthorized use of their digital signature creating data.
- Promptly using appropriate means to notify the parties accepting the electronic signature and to the organization providing the e-signature certification service in case the electronic signature is certified when discovering that electronic signatures may no longer be under their control; and
- Applying necessary measures to ensure the accuracy and integrity of all information in the e-certificate if the e-certificate is used to authenticate the electronic signature.
4. Employees’ obligations when receiving digitally signed labor contracts
Employees have the following obligations:
- Taking necessary measures to verify the reliability of an electronic signature before accepting it; and
- Taking necessary measures to verify the legal validity of e-certificates and restrictions related to e-certificates in case such e-certificate is used to certify the electronic signature.
Absolutely, the advancement of digital technology has had, is having, and will continue to have a major impact on legal provisions. It is inevitable that in the near future, electronic labor contracts will largely replace traditional labor contracts. Given that social distancing policies are still in place in Vietnam and other nations, electronic signatures have a good chance of growing in popularity and developing because they allow the parties to a labor contract to sign it at the appropriate time while still adhering to the legal minimum distance requirements.
Nevertheless, in addition to the contracting parties’ behavioral modification, the registration process and the use of digital signatures must be simplified while maintaining secrecy and authenticity standards. This is also a chance for startups to solve this issue. It’s not easy to break a long-standing habit, so it’s challenging to create a solution that will allow employers to remove safety barriers safeguarding old wet-ink labor contracts.
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_Phi Ngoc Dung_