Termination of Employment
The Work Protection Act B.E. 2541 (1998) (“the Act”) pertains to all companies operating in Thailand. The businessOrworker relationship is controlled under Thai law, including matters concerning the termination of the worker.
The primary explanations why Thailand employers may consider payroll cuts by terminating staff could be summarised briefly as economic, poor performance or misconduct.
It’s quite common within the Thailand legal atmosphere the Work Court has a tendency to favour the worker and accordingly it’s very essential that business proprietors in Thailand adopt correct procedures insofar as termination of the employees.
Termination Payment Calculation Summary
This is a listing of the quantum of severance pay which should be compensated by a company for an worker under Thai law if Section 118 from the Act is used. This really is calculated in compliance using the employee’s period of service.
4 months but under 12 months – thirty days pay
12 months but under three years – 3 months pay
three years but under 6 years – 180 days pay
6 years but under ten years – 240 days pay
greater than ten years – 300 days pay
Exclusions to Payment of Severance Pay
A. Short or Temporary Employment Periods
Work laws and regulations in Thailand afford business proprietors certain exclusions from the necessity to pay severance payments when the following conditions apply:
An worker has offered the organization for under 4 months.
An worker whose employment is stipulated inside a contract looking for an absolute period and also the employment is ended in the finish of this period, if the type of employment is within compliance using the Thai work laws and regulations and rules (Section 118 from the Act).
Employment having a definite period is permitted only for an additional groups
Employment on the specific project which isn’t the standard business from the employer
Employment for periodic or temporary work and,
An itemized employment contract is needed for that above with clauses stipulating the commencement and completion dates. Additionally, all tasks should be completed within 2 yrs.
B. Termination with Cause
Under Section 119 from the Act, there are specific exceptions which enable a company to prevent the payment of severance for an worker and which are listed below:-
The worker performs dishonestly or intentionally commits an offence from the employer
The worker intentionally causes the business to suffer loss
The worker causes serious harm to the business because of negligence
The worker violates the employer’s working rules or rules or even the employer’s orders that are legal and fair in which the employer has because of the worker an itemized warning, with the exception of a significant situation in which the employer isn’t needed to supply a warning
The worker neglects to accomplish their responsibilities by not attending work without justifiable reason behind three consecutive business days and,
The worker has stayed imprisonment by final judgement, except for negligence or petty offences.
The exceptions that employers are responsible for severance pay are stipulated in Section 119 (1) – (6) from the Act.
When the employer terminates the use contract from the worker for other grounds, the worker is titled to get severance pay.
Nonetheless, to terminate the use associated with a worker for the reason stipulated in Section 119 from the Act, the business must give a letter of termination towards the worker using the causes of termination. Observe that in compliance with Thai law, the reason why provided should be real or connect with those things for termination of employment.
Special Severance Pay
Within the situation where a company relocates the office in Thailand which affects the standard living of the worker or his/her family, the business shall inform the worker a minimum of thirty days prior to the date of moving. Thai law enables the worker to won’t move and be titled to get severance pay. Failure to inform the worker may lead to a unique severance payment instead of the development notice of thirty days.