Thailand Employment

Termination of Employment

BE 2541 (1998) (hereinafter: the Act) applies to all enterprises operating in Thailand. The employer / employee relationship is governed by Thai law, including issues related to the termination of the employee.

The main reasons why Thai employers may consider payroll by graduate staff are briefly summarized as economic, poor performance, or bad behavior.

In the Thai legal environment, it is common for the Labor Court to recommend the benefit of the employee, and it is therefore extremely important that the owners of Thai businesses apply appropriate procedures if employees are terminated.

Summary of Compensation for Termination

The following is a summary of the severance payment that an employer has to pay to an employee under Thai law if Article 118 of the Act applies. This is calculated according to the length of service of the employee.

120 days but less than 1 year – 30 days pay
1 year but less than 3 years – 90 days pay
3 years but less than 6 years – 180 days salary
6 years but less than 10 years – 240 days salary
more than 10 years – 300 days salary
Exceptions to payment of benefit

A. Short or temporary periods of employment

There are strong exceptions to the requirement to pay severance pay in Thailand for the owners of entrepreneurs if the following conditions apply:
One employee worked for the company for less than 120 days.
An employee who is defined for a specified period in a contract and the employment relationship ends at the end of that period if this form of employment complies with Thai labor laws and regulations (Article 118 of the Act).

Fixed-term employment is only allowed in the following categories;
Employment on a particular project, which is not the usual activity of the employer;
Employment for occasional or temporary work; and
Seasonal Employment.


B. Withdrawal Reason

According to Article 119 of the Act, certain exceptions allow the employee to avoid paying the employee the severance pay and are: –

Employee performances commit an unfair or deliberate crime against the employer;
The employee deliberately causes the loss of the employer;
The employee causes serious damage to the employer due to negligence;
The employee violates the employer's employment regulations and the employer's legal and fair rules if the employer has already given the employee a written warning, except for the serious situation when the employee does not need to warn;
The employee fails to perform his / her duties without taking part in the three business days without unreasonable reason; and
The employee has served a final sentence in the offense, except for negligence or minor offenses.
The exceptions for which employers are responsible for severance payments are set out in Article 119 (1) to (6) of the Act.

If, for any other reason, the employer terminates the employee's employment contract, the employee is entitled to severance pay.

However, in order to terminate an employee for the reasons specified in section 119 of the Act, the employer must provide a notice of termination on the grounds of termination. It should be noted that, according to Thai law, the reasons given must be true or linked to claims for termination of employment.

Special Allowance

If an employee moves to a place of business in Thailand that affects the normal life of an employee or family, the employee will at least notify the employee. 30 days before the transfer date. The Thai law allows the employee to refuse movement and to attract himself to receive severance pay. Failure to notify the employee may result in a special severance payment instead of a 30-day notice.

As a result of the introduction of machinery or technologies that result in the termination of employees, the employee is required to notify the employee and the employee in accordance with Thai law (Article 121 of the Act) of termination of employment based on the reorganization of a company, production line, sale or service based in Thailand. labor inspector at least 60 days before the planned date of termination. Failure to do so will result in a special deduction in addition to the standard 60-day notice.

Source by Lily B

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