A reader with email address anhphamx @ xx asked: A few years ago, I opened a carpentry factory, initially registered to use 5 employees. However, due to business needs, I want to hire about 10 more employees to work in the factory. How many employees can a household business use?

Lawyer Nguyen Thi Trang, YouMe Law Firm answers:

Article 66 of Decree No. 78/2015 / ND-CP on enterprise registration provides for business householdas follows:

1. Business household owned by an individual, a group of individuals being Vietnamese citizens from 18 years of age or older, have full civil capacity, or owned by a household may only register one business location, employs fewer than 10 employees, and take responsibility for the business operation with all of their property. 2. Households engaged in agriculture, forestry, aquaculture, salt productions, street vendors, nomadic businesspeople, and service providers earning low revenues are not required to registered, except for conditional business lines. The People’s Committees of provinces shall specify the low revenues applied within their provinces. 3. Any business household that hires 10 employees or more must apply for enterprise registration as prescribed.

Clause 1, Article 41 of Decree No. 50/2016 / ND-CP providing for sanctioning of administrative violations in the field of Planning - Investment (Decree 50/2016 / ND-CP) stipulates the sanctioning of violations. Regarding business registration of business households as follows:

1. A fine of VND 3,000,000 - VND 5,000,000 shall be imposed for any of the following violations:

a) Registering more than one business households;

b) Failure to submit a business report at the request of the business registration authority of the district;

c) Employ more than 10 regular employees;

d) Wholesaling or doing mobile business at a location other than that registered with the business registration authority of the district without notifying the tax authority or market surveillance authority of the area where the headquarters is located and where the business is done;

dd) Establishing a business household without the right to do so;

e) Failure to register the establishment of a business household that were compulsory.

Point b, Clause 3, Article 41 of Decree No. 50/2016 / ND-CP provides remedial measures as follows: b) Register the enterprise establishment in case of the violation specified in Point c Clause 1 of this Article;

Thus, business households can only use less than 10 employees. In case a business household employs 10 or more employees, it is required to register for enterprise establishment. If you regularly employ 10 or more employees but do not set up a business, you will be fined and be subject to the application of remedial measures that are forced to establish an enterprise.