Multiplicity, evenhandedness, and belonging... Variety, balance, and a warm welcome... US companies are searching for synonyms; the thesauruses of their in-house counsel are now dog-eared and well thumbed. In the wake of US President Donald Trump's executive orders to eliminate diversity, equity, and inclusion (DEI) programs within the federal government and to direct federal agencies to act against DEI policies in the private sector, some American companies have scrambled to change their language. With President Trump's direction to prosecute discrimination alleged to be under the guise of DEI, using the term "DEI" on a company website risks painting a big red target on those companies.
While some have opted to adjust the descriptions of their programs aimed at improving the status of marginalized groups, others are scrapping their DEI programs entirely. However, US-invested companies should be cautious in eliminating their DEI programs globally, as some elements of these programs are obligations under local laws. In this article, we note some key points for American companies to consider in respect to their subsidiaries based in Vietnam, Thailand, and Cambodia.
Background
President Trump issued an executive order on January 21, 2025, titled "Ending Illegal Discrimination and Restoring Merit-Based Opportunity." Among other things, this executive order instructs the attorney general to cooperate with the heads of federal agencies to identify private-sector companies with discriminatory DEI programs. This executive order is premised on the idea that actions favoring members of marginalized groups over majority or dominant groups constitute illegal discriminatory action. An example of this would be hiring quotas for women or visible minorities, which this worldview alleges has resulted in white male candidates being turned down in favor of female or Black candidates.
Public companies and large nonprofit organizations identified as engaging in illegal discriminatory conduct through their DEI programs may be subject to civil compliance investigations. Other companies in the private sector could also face public and private actions arising from allegations of breaching nondiscrimination statutes and orders. Thus, any actions taking into consideration race, sex, sexual orientation, disability, or an individual's membership in a marginalized group in making employment decisions may be considered illegal discrimination and be subject to legal action. This risk is what has led many US companies to recharacterize their DEI programs or eliminate them altogether.
Considerations for Vietnam
Positive discrimination for the protection of vulnerable groups
Vietnam defines discrimination in the context of employment differently than the US. Vietnam's Labor Code states, "Positive discrimination on the grounds of professional requirements, the sustainment and employment protection for vulnerable employees will not be considered discrimination." Accordingly, Vietnamese labor law stipulates some benefits and protections aimed at sustaining and providing employment protection for vulnerable groups, particularly women in the context of maternity or raising a young child.
The Labor Code provides various accommodations to female employees that could be considered discrimination under the Trump administration's current view of DEI programs, since they provide benefits to female employees that are not offered to male ones. Pregnant employees engaged in labor-intensive, hazardous, or toxic work may request a transfer to a safer or less demanding role or may opt for a one-hour reduction in their daily working time without a reduction in pay. These adjustments must be made without affecting the employee's salary, benefits, or other lawful entitlements. Additionally, from the seventh month of pregnancy—or the sixth month in remote, upland, border, or island regions—employers are barred from assigning night shifts, overtime, or long-distance travel. Additional protections apply to nursing mothers. They cannot be required to work night shifts, overtime, or travel for business without their consent. Moreover, they are entitled to a fully paid 60-minute break during each working day, which is considered part of their regular working hours.
Female employees also enjoy additional protection from termination of employment not provided to their male counterparts. Female employees are protected from unilateral termination or dismissal while pregnant or on maternity leave. Both male and female employees enjoy protection from dismissal while raising a child under 12 months old.
Vietnamese labor law also focuses on protecting women from sexual harassment, which may be a key aspect of corporate DEI programs. Employers are required to include detailed regulations in their internal labor regulations (the official working rules of the employer registered with the labor authority) regarding how sexual harassment complaints will be investigated and addressed. Additionally, employers are required to ensure their employees are aware of and understand these regulations.
Consequences of eliminating protective measures and benefits that do not apply equally to all employees
If US-invested companies in Vietnam adopt a view of discrimination that insists upon the completely equal treatment of all employees, and they fail to implement the additional benefits and protections afforded to female employees under the Labor Code, they may face wrongful termination lawsuits and administrative fines.
If a Vietnamese subsidiary of a US company terminates or dismisses a female employee while she is entitled to protected status under the law and she brings a wrongful termination lawsuit and wins, she would be entitled to remedies that could include mandatory reinstatement and various levels of compensation depending on the specific circumstances.
For each act of failing to provide the additional rights and entitlements to female employees mentioned above, organizations may face administrative fines ranging from VND 20 million to 40 million (approx. USD 765–1,530).
If sexual harassment occurred in the workplace, the employer could face an administrative fine ranging from VND 30 million to 60 million (approx. USD 1,150–2,300) and could additionally face civil liability for the acts of its employee if they were performed in the course of their performance of job duties.
Considerations for Thailand
Thailand's Labor Protection Act (LPA) provides foundational protections for employees, including provisions that support gender equality and prohibit workplace harassment.
The LPA explicitly prohibits sexual harassment in the workplace. Employers, supervisors, and inspectors are forbidden from engaging in sexual harassment, making sexual threats, or otherwise disturbing employees in a sexual manner. Violations can result in fines of up to THB 20,000 (approx. USD 615), in addition to civil claims and other remedies. Thus, if issues such as sexual harassment are neglected as part of abandoning DEI, employers may face consequences.
Special protections for female and pregnant employees
The LPA outlines specific protections for female employees that are not afforded to male employees—particularly in relation to hazardous work environments. Employers are prohibited from assigning women to the following tasks:
- Mining or construction work underground, underwater, in a cave, or in a tunnel or mountain shaft, except where the conditions of work are deemed to be not harmful to the health or body of the female employee.
- Work on scaffolding 10 meters high or above.
- Handling or transporting explosive or flammable materials, except where the conditions of work are deemed not harmful to the health or body of the female employee.
- Other work as prescribed by ministerial regulations.
Additionally, if a female employee is required to work between midnight and 6:00 a.m. and a labor inspector deems the work to be hazardous, the employer must adjust her working hours accordingly.
Pregnant employees receive further protections, as employers cannot require pregnant workers to:
- Operate vibrating machinery or engines;
- Drive or travel on vehicles;
- Lift or carry loads exceeding 15 kilograms;
- Work on boats; or
- Perform other tasks that are restricted by ministerial regulations.
Pregnant employees are also protected from working overtime, on holidays, or between 10:00 p.m. and 6:00 a.m., unless they hold executive, academic, clerical, or financial roles and consent to such work without health risks. Pregnant employees may also present medical certification to request temporary reassignment to more suitable duties before or after childbirth, and employers are obligated to consider such requests.
Employment of persons with disabilities
Under the Empowerment of Persons with Disabilities Act, employers with 100 or more employees are required to promote inclusive hiring practices by employing persons with disabilities at a ratio of at least one person with a disability for every 100 employees.
If an employer does not meet this employment ratio, they are required to make an annual contribution to the Fund for the Empowerment of Persons with Disabilities, which is used to support rehabilitation, education, occupational training, and welfare services for persons with disabilities. The contribution amount is calculated based on the lowest daily minimum wage from the previous year, multiplied by 365 days and by the number of persons with disabilities who would otherwise have been employed under the quota.
If an employer does not hire persons with disabilities and does not wish to contribute to the fund, alternative compliance options may be available through various types of special arrangements, accommodations, or other forms of assistance to persons with disabilities or their caregivers.
Consequences of eliminating protective measures and benefits that do not equally apply to all employees
In respect to penalties, for failing to provide the additional rights and entitlements to female and pregnant employees mentioned above, employers may be subject to imprisonment for up to six months, a fine of up to THB 100,000 (approximately USD 3,100), or both.
Employers who are required to contribute to the Fund for the Empowerment of Persons with Disabilities but fail to do so, delay payment, or remit an insufficient amount are subject to interest charges on the outstanding balance owed to the fund.
Considerations for Cambodia
Cambodia's laws both broadly protect minority groups from discrimination in employment decisions and set out more specific protections for female employees, disabled employees, and employees with HIV. These additional protective measures could be considered discriminatory under the Trump administration's current perspective on DEI programs.
Special protections for female employees
Women, particularly while pregnant, receive additional protections and benefits under Cambodia's Labor Law. Women are exempt from the provision that allows employers to suspend weekly time off for necessary employees in the case of an emergency. Companies that employ women "must watch over their good behavior and maintain their decency before the public," which includes a prohibition on sexual harassment.
Pregnant women are entitled to maternity leave of 90 days, a portion of which is paid if they have worked for at least one year for the employer. Employers cannot lay off female workers during their maternity leave or at a time when the end of the notice period would fall during their maternity leave. Women are expected to do only light work during the two months following their maternity leave. For one year after giving birth, women are entitled to use one work hour per day to breastfeed their children while receiving their full salaries. Companies with at least 100 female employees must set up a nursing room and day-care center at the workplace or nearby. Additionally, the Ministry of Labor and Vocational Training issued Instruction No. 015/25 to prohibit discrimination against female employees and prevent employers from suspending the employment contracts of pregnant employees within nine months of their return from maternity leave, with limited exceptions.
Special protections for disabled employees
Cambodia has instituted a recruitment quota for disabled employees. Companies with at least 100 employees must employ disabled workers at a minimum rate of 1% of their total number of employees. Companies with at least 100 employees that surpass the quota and companies with under 100 employees that hire disabled workers despite not being subject to a quota will receive incentives. The regulation establishing this quota also requires employers to make adequate adjustments to the working conditions of disabled employees.
In addition, the Labor Law states that employees who suffer from chronic illness, insanity, or permanent disability are released from the obligation to notify their employer before quitting.
Special Protections for Employees with HIV
Cambodian laws also establish protections for employees with HIV by prohibiting discrimination against employees with HIV and establishing that HIV is not a cause for termination. Furthermore, companies with at least eight employees must establish an HIV/AIDS working group or committee to support employees who have HIV.
Consequences of eliminating protective measures and benefits that do not equally apply to all employees
Infractions of these protective measures for employees in Cambodia are punishable by fines.
For instance, companies that fail to provide female employees with maternity leave as mandated by law, lay off employees during maternity leave, require employees to perform more than light work in the two months following maternity leave, or fail to provide nursing accommodations may face administrative fines of KHR 3,360,000 (USD 840) per incident. Companies that neglect their obligation to set up a nursery are subject to a KHR 1,680,000 (USD 420) fine.
Companies that fail to meet the hiring quota for disabled workers must make a recruitment plan to meet the quota within three years and make a contribution to the Disability Foundation equivalent to 40% of the monthly salary of the lowest-paid employee. If they fail to meet the quota and do not pay the contribution, they will face a fine ranging from KHR 100,000 (USD 25) to KHR 1 million (USD 250).
The Department of Occupational Health of the General Directorate of Labor and Vocational Training has the authority to discipline employers who do not comply with the regulatory protections for employees with HIV, such as failing to set up an HIV/AIDS working group or committee. Discipline comes in the form of providing advice for minor infractions and setting deadlines for compliance for larger infractions.
Conclusion
US-invested subsidiaries in Vietnam, Thailand, and Cambodia must carefully consider their local legal obligations if they contemplate rolling back their global DEI programs. Removing or drastically altering existing DEI programs could result in serious legal violations in Southeast Asia, resulting in subsidiaries facing administrative fines, wrongful termination lawsuits, and loss of reputation. Eliminating DEI trainings, in particular anti-sexual harassment trainings, could similarly expose employers to significant liability.
In Vietnam, Thailand, and Cambodia, actions to accommodate or benefit marginalized groups are not considered discriminatory—in contrast with the view put forward by the Trump administration. Companies should review and tailor their DEI programs to ensure they meet their local legal obligations, avoiding potential lawsuits and liability.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
