If your company doesn't have a legal entity in Vietnam, you can't simply put a Vietnamese engineer on your US payroll — local law requires a local employer to run payroll, withhold tax, and pay statutory contributions. An Employer of Record (EOR) solves this by becoming that local employer on your behalf, so you can hire without incorporating.
Who employs whom
With an EOR, there are three parties. The engineer does the work. The EOR (AppTuring, through our licensed Vietnamese entity) is the legal employer — it signs the local employment contract, runs payroll, and carries the compliance obligations. Your company is the client: you interview, select, and direct the engineer's day-to-day work exactly as you would an in-house hire.
You manage the work. The EOR manages the employment.
What the EOR actually does
- Drafts and signs a locally compliant employment contract
- Runs gross-to-net payroll and pays the engineer in local currency
- Files the ~23.5% employer statutory contributions (social, health, unemployment, union) and withholds personal income tax
- Administers statutory benefits, leave, and the 13th-month bonus
- Keeps you compliant with the Vietnam Labor Code as rules change
- Handles compliant onboarding and, later, offboarding
You receive one consolidated monthly invoice — salary at cost, statutory contributions, and a flat management fee — instead of managing a foreign payroll yourself.
Who owns the code and IP?
This is the question every CTO and general counsel asks. A well-built EOR uses a back-to-back IP assignment: the engineer assigns their work to the EOR, and the EOR assigns it onward to your US entity. Combined with enforceable NDAs, the chain of title is unbroken and everything your team builds is legally yours. See our compliance & IP section for the assignment flow.
EOR vs. setting up your own entity
Incorporating a Vietnamese entity takes months and $15k–$30k+ up front, plus ongoing accounting, payroll, and compliance overhead. For teams of 1–30 engineers, an EOR is faster and cheaper; an entity only pays off with a large, permanent local presence. We break down the exact crossover in EOR vs. your own entity and the complete Vietnam hiring guide.
How fast can you start?
Because the entity already exists, onboarding is quick: a typical engineer is contracted and productive in around 10 business days, versus the multi-month path of standing up your own entity.