Background of Labor Law and Employment Law in ThailandThailand’s employment laws, governed by the Department of Labor, Protection and Welfare, regulate employment and working conditions such as maximum work hours, working days, holidays, overtime, maternity leave, employee welfare, social security, termination of employees, occupational health and safety, grievances, sick leave, minimum wage and severance pay.
The following Acts cover Labor and Employment law in Thailand:
Labor Protection Act B.E. 2541 (1998) Labor Relations Act B.E. 2518 (1975)
The Act Establishing the Labor Court and Labor Court Procedure B.E. 2522 (1979)
Provident Fund Act B.E. 2530 (1987) Social Security Act B.E. 2533 (1990)
Workmen’s Compensation Act B.E. 2537 (1994) and Thai Civil and Commercial Code.
Types of Disputes
The law in Thailand requires companies to pay compensation to employees upon termination in the form of severance pay under certain condition and pursuant to an official schedule.
Employment claims in Thailand can relate to the calculation of severance pay or the employee’s right to severance pay. Labor law or Employment law cases may also involve issues of wrongful termination, breach of contract or injuries that occur during scope of work.
Thailand Severance Pay and Termination Issues
Employment in Thailand may be terminated for a variety of reasons, including the following:
- Completion of agreed upon work
- Expiration of contract and legal employment period
- Mutual agreement reached on termination of contract
- Employment being transferred to a third party, without agreement of employee
- In case of gross misconduct performed by employee, termination by employer
An employee is entitled to severance pay given that they have completed at least 120 days of employment and have not been terminated from their position for one of the following reasons:
- Dishonestly performing duties
- Intentionally committing an act of crime against their employer
- Intentionally causing harm to their employer
- Gross negligence causing serious harm to the employer
- Violating rules at the place of employment for which a previous written warning has been provided to the employee
- Neglect of the employee’s work duties for three consecutive days without any justification
- Being sentenced to imprisonment, exceptions made for petty offenses and offenses stemming from negligent acts.
Severance pay is available to both Thai and foreign staff members that have been terminated
