If employed more than one year, but less than three years, employees are entitled to severance pay equal to three months' salary. Complaints (Sections 123-125) ». Maximum severance pay. As a result, the employee will be entitled to the amount equivalent to severance pay to be paid upon termination of employment. If the employer terminates me, am I entitle of any severence pay atleast 240 days since I have been there for 8 years. Severance Pay 2. CONTENTS Page Labour Protection Act B.E. posted by msna-admin. The Employer is not required to pay severance pay to an employee whose employment has been terminated under any of the following conditions: violating work rules or regulations or orders of the Employer which are lawful and just, and after the written warning has been given by the Employer, except in a serious case where the Employer is not required to give warning. if the employee has worked for an uninterrupted period of ten years or more, he or she shall be entitled to receive payment of not less than his or her last rate of Wages for three hundred days, or if not less than his or her Wages for the last three hundred days for an Employee who receives Wages on a piece-rate basis. In Thailand, retirement is deemed to be a termination of employment, entitling employees to a severance payment. By Chusert Supasitthumrong, Tilleke & Gibbins. New amendments to Thailand’s Labor Protection Act have addressed this issue by introducing a retirement regime for the Thai private sector employees, placing severance obligations on employers, enhancing protection for employees, and creating a more effective framework for enforcement of labour laws. Such work shall be completed within a period not exceeding two years and the Employer shall make a written contract with the Employee at the beginning of the employment. When managing a business in Thailand with employees, senior management should pay attention to the Labour Protection Act (1998) (“LPA”) and its related Ministerial Regulations given the broad impact it has coupled with the legal penalties which can be imposed on them should they breach this law. Employees with at least 20 years of service are entitled to 400 days of statutory severance, up from 300 days for employees with at least 10 years' service. Under the circumstance of normal termination of employment where “termination of employment” means: The company shall pay severance pay to an employee whose employment is terminated, as follows: The company is not required to pay severance pay to an employee whose employment has been terminated for any of the following reasons: As a leading provider of corporate services, we specialise in covering everything startups and established companies need to successfully start and operate their new business in Thailand. Severance pay is a matter of agreement between an employer and an employee (or the employee's representative). Q:Does the employer have to pay additional compensation to an employee subject to a non-competition clause? The company shall act the following: Where an employer relocates its place of business, and the relocation materially affects the ordinary course of living of the employee or his family, the company shall act the following: The company shall send notification to the employee to be terminated, of the date of termination of employment, the reasons for terminating the employment and name(s) of employee(s) to be terminated at least 60 days in advance of the employment termination date. No, Thai law does not require the employer to compensate an employee subject to a non-competition clause. To terminate the Contract of Employment under this Section, the Employee shall exercise his or her right within thirty days from the date of relocation, or from the date of the decision of the Labor Welfare Committee or the judgment of court becoming final. And the timing of their dismissal may also result in more expense than one may think could be incurred. An employee terminated without a valid cause as stipulated by law is entitled to receive the following severance pay: 30 days’ wages where the employment period is at least 120 days but is less than one year. in performing duties or a guideline in conforming to the labour laws. performing his or her duty dishonestly or intentionally committing a criminal offence against the Employer; intentionally causing damage to the Employer; causing serious damage to the Employer as a result of negligence; neglecting his or her duty without justifiable reason for three consecutive Working Days regardless of whether there is Holiday in between or not; or. Severance pay is money your employer pays you when you lose your job through no fault of your own. Thai Labor Law and How it Impacts Employer-Employee Relations. Whereas the Employer fails to notify in advance an Employee contemplated to be terminated, or has notified an Employee of less than the period prescribed under paragraph one, apart from the Severance Pay to be paid under Section 118, the Employer shall also pay Special Severance Pay in lieu of advance notice equivalent to the Employee’s last rate of Wages for sixty days, or an amount equivalent to the Employee’s Wages for the last sixty days to an Employee who is paid on a piece-rate basis. Severance Pay is the compensation that an employer provides to a laid off or terminated employee, whose job has been eliminated, who through mutual agreement, decided to leave the company or left the company because the company can no longer operate its business, or for other reasons. The National Legislative Assembly has announced the new entitlements shall be effective from 24 February 2019, subject to the publication of the law in the Royal Gazette. « Suspension (Sections 116-117) For example, if the employee has worked for eight years, the employer is obligated to provide special severance pay of 30 days (15 x 2), in addition to the special severance pay outlined in section 3. Are you in Thailand and feeling low? Previously, the law was silent on the issue and employers had discretion to set their own retirement policy. Transcript of the above video: ... there may be statutorily required severance pay that may be due to that individual. Jor – An employee who has worked for more than 10 years consecutively shall be paid severance pay for not less than 300 days at the most recent rate of basic pay or the basic pay received in respect of the preceeding 300 days in the case of an employee who receives his basic pay based upon his output. The new Labor Protection Act (No. BHUMIBOL ADULYADEJ, REX. The termination because of improvements to the working unit, production, distribution or service processes arising from the utilization of machinery or a change of machinery or technology, and which is the cause of the reduction in the number of the employees. It is usually based on length of employment for which an employee is eligible upon termination. The provisions of paragraph one shall not apply to an Employee whose employment is for a definite period and the employment is terminated at the end of that period. These laws cover all areas related to employment such as working hours, holidays and leave, notice, overtime, sick pay, and severance, and are applicable to both Thai and foreign employees. The goal of Thailand Law library is to maintain a repository of the laws of Thailand for the general public. Q:Can an employee take leg… THAI LABOR LAWS Labor matters are generally governed by the Labor Protection Act B.E. 2541 (1998) and the ... severance pay, ... consequences are governed by general stipulations regarding employment in the Civil and Commercial Code and the Labor Law. In the case the employee has worked continuously for six years or more, the company shall pay special severance pay in addition to the severance pay under Clause 8.1, in an amount of not less than the basic pay received for the most recent 15 days, for each complete year of work; or not less than the basic pay received for the most recent 15 days for each complete year of work in the case of an employee who receives his basic pay based upon his output, but the total severance pay shall not, in the aggregate, exceed 360-day basic pay at the most recent rate or not exceed the basic pay for the last 360 days in the case of an employee who receives his basic pay based upon his output. 4) Is it better to resign and save my self-respect or wait for the company to fire me so I can get severence pay, should there be any. Severance pay is often granted to employees upon termination of employment. 2541 (1998) 8 ... CHAPTER 11 Severance Pay 38 CHAPTER 12 Lodgment and Consideration of Complaints 41 CHAPTER 13 Employee Welfare Fund 44 Whereas the Employer terminates the employment of an Employee under Section 121 and such Employee has worked for uninterrupted period of more than six years, the Employer shall pay Special Severance Pay in addition to Severance Pay under Section 118 of not less than the Employee’s last rate of Wages for fifteen days for each year of employment or of not less than the Employee’s Wages for the last fifteen days for each year of employment for an Employee who is paid on a piece-rate basis. But, and this is very important, a severance or ex gratia payment was not compulsory under Thai labor law before 1 September 2017. The Department of Labour Protection and Welfare February B.E. Employees’ severance pay rights and legal loopholes Thursday, December 17, 2020 Increased from 300 days to 400 days of wage for terminating an employee with an employment period of 20 years or more . This article addresses several of the most important aspects of this Act and its Regulations. You believe what the schools tell you and you are afraid to question them so you can stay in the Land of Smiles. An employer is required by the Thai Labor Protection Act (LPA) to pay wages, overtime payments, remuneration for working during holidays and statutory severance payments. 2) Dismissal based on business reasons: December 4, 2010. Thailand Labour Law – Severance Pay What is Severance Pay? The Thai Cabinet has endorsed a proposal to amend the Labour Protection Act, setting a statutory retirement age for the first time and entitling retirees to statutory severance pay. Based on the Thai labour law, severance pay … Thailand Law Library is managed by Siam Legal International. The Ministry of Labor (MOL) is the primary authority responsible for setting and enforcing minimum employment standards in the country. Therefore, the workers at Kabinburi are also entitled to an additional one-month salary in lieu of notice pay. 2541 This means that the effective date may be delayed. being imprisoned by a final judgment of imprisonment with the exception for offenses arising out of negligence or for petty offenses. Given on this 12th day of February B.E. Notify the employee of the relocation not less than 30 days prior to the date of relocation. Whereas the Employer terminates the employment of an Employee under Section 121 and such Employee has worked for uninterrupted period of more than six years, the Employer shall pay Special Severance Pay in addition to Severance Pay under Section 118 of not less than the Employee’s last rate of Wages for fifteen days for each year of employment or of not less than the Employee’s Wages for the last fifteen … Recent Labor Law Changes in Thailand for Severance Pay, ... the National Legislative Assembly amended the Labor Protection Act increasing severance pay and ... What Thai … Home » Labor Protection Act » Severance (Sections 118-122). Such written warning shall be valid for not more than one year from the date of commission of the offence by the Employee; Whereas an Employer relocates the place of business to another place and it significantly affects the normal living of an Employee or his or her family, the Employer shall notify the Employee of not less than thirty days prior to the date of relocation. Use this calculator to determine the amount of severance pay that is owing. The company prevents an employee from continuing to work and receive his basic pay thereof, whether due to the termination of an employment contract or for any other reason, The situation where an employee cannot work and be paid because the company can no longer operate its business, Gor – An employee who has worked for at least 120 consecutive days, but for less than one year shall be paid severance pay for not less than 30 days at the most recent rate of basic pay or the basic pay received in respect of the preceeding 30 days in the case of an employee who receives his basic pay based upon his output, Khor – An employee who has worked continuously for at least one year but less than three years shall be paid severance pay for not less than 90 days at the most recent rate of basic pay or the basic pay received in respect of the preceeding 90 days in the case of an employee who receives his basic pay based upon his output, Kor – An employee who has worked continuously for at least three years but less than six years shall be severance basic pay for not less than 180 days at the most recent rate of basic pay or the basic pay received in respect of the preceeding 180 days in the case of an employee who receives his basic pay based upon his output, Ngor – An employee who has worked continuously for at least six years but less than 10 years shall be paid severance pay for not less than 240 days at the most recent rate of basic or the basic pay received in respect of the preceeding 240 days in the case of an employee who receives his basic pay based upon his output, Jor – An employee who has worked for more than 10 years consecutively shall be paid severance pay for not less than 300 days at the most recent rate of basic pay or the basic pay received in respect of the preceeding 300 days in the case of an employee who receives his basic pay based upon his output, Dishonest performance of his duties or the intentional commission of a criminal act against the company, Intentionally causing loss to the company, Performance of an act of gross negligence which results in severe loss to the company, Violation of the company’s work rules and regulations or orders which are both lawful and equitable when the company has already issued the employee with a prior written warning, Neglect of his duties for a period of three consecutive work days without reasonable cause, whether or not a holiday intervenes, Imprisonment by reason of a final judgment, except in the case of offences which arise from negligence of for petty offences, Gor – The employment with a fixed duration may expire without any requirement for advance notice from both the company and an employee, Khor – Where no specific term is set out in the employment contract, the company may terminate or an employee may resign by giving a written notice to the other party at least one instalment of payment advance or longer but there is no need to be longer than three months advance notice. Recent Key Updates in Thailand Labour Protection Law The Labour Protection Act BE 2541 (1998) (the “LPA”) has been periodically amended.The recent key amendments were made by the Labour Protection Act (No.6) BE 2560 (2017) and the Labour Protection Act (No.7) BE 2562 (2019), which became effective from 1 September 2017 and 5 May 2019, respectively. An employee whose employment is stipulated in a contract set for a definite periodand the employment is terminated at the end of that period, if this form of employment is in compliance with the Thai labour laws and regulations (Section 118 of the Act). According to Thai labour law an employee must be given notice of termination at least one pay period or one month in advance of termination. Abortion in Thailand: A New Law Coming into Effect, Working in Thailand as Foreign Entrepreneur, Guidelines to Operate Professional Service Business in Thailand, Thai Limited Companies: Shareholder Meetings. Severance Pay Ontario. Siam Legal International does not claim any rights over the republication of Thai laws within this website. Not exceed 8 hours per day and 48 hours per week ; Works which may be harmful to the health or safety of the employees as prescribed by Ministerial Regulations shall not exceed seven hours per day and not exceed 42 hours per week. There is no requirement in the Fair Labor Standards Act (FLSA) for severance pay. UNDER THAI LABOUR LAWS, employers are required to offer severance pay to employees who are terminated based on non-statutory grounds. If employed more than three years, but less than six years, employees are entitled to severance pay equal to six months' salary. Employees who are covered by the ESA, and who have at least five years' employment with their employer, are entitled to severance pay when their employment is severed, if: The employer has an annual payroll of at least $2.5 million, OR Being the 53rd year of the Present Reign. if the Employee has worked for an uninterrupted period of one hundred and twenty days but less than one year, he or she shall be entitled to receive payment of not less than his or her last rate of Wages for thirty days, or of not less than his or her Wages for the last thirty days for an Employee who received Wages on a piece-rate basis; if the employee has worked for an uninterrupted period of one year but less than three years, he or she shall be entitled to receive payment of not less than his or her last rate of Wages for ninety days, or of not less than his or her Wages for the last ninety days for an Employee who receives Wages on a piece-rate basis; if the Employee has worked for an uninterrupted period of three years but less than six years, he or she shall be entitled to receive payment of not less than his or her last rate of Wages for one hundred and eighty days, or if not less than his or her Wages for the last one hundred and eighty days for an Employee who receives Wages on a piece-rate basis; if the Employee has worked for an uninterrupted period of six years but less than ten years, he or she shall be entitled to receive payment of not less than his or her last rate of Wages for two hundred and forty days, or if not less than his or her Wages for the last two hundred and forty days for an Employee who receives Wages on a piece-rate basis; or. For this purpose, if the Employee refuses to go to work in the new location, the Employee is entitled to terminate the Contract of Employment and receive Special Severance Pay of not less than fifty percent of the rate of Severance Pay he or she entitled to under Section 118. Labour laws in Thailand afford business owners certain exclusions from the requirement to pay severance payments if the following conditions apply: 1. The decision of the Labor Welfare Committee shall be final unless the Employer or the Employee appeals against the decision to the Court within thirty days as from the date of receipt of the decision. Where the company fails to give advance notice less than 60 days in advance, the company shall pay special severance pay in lieu of the advance notice in an amount equal to 60-day pay at the most recent rate of basic pay, or the basic pay received in respect of the preceeding 60 days in the case of an employee who receives his basic pay based upon his output. So you think it is all fun and games. In case for an employee who has worked for uninterrupted period of 6 years or more, an employer must pay special severance pay in addition to severance pay for each year of employment of not less than the employee’s last rate of wages for 15 days or for each year of employment or of not less than an employee’s wages for the last 15 days for an employee who is paid on a piece rate basis. The Thai Government recently published in its Royal Gazette a set of new changes to the Labor Protection Act (LPA), effective 5 th May 2019, aiming at further improving employee’s working conditions as follows:. Where the Employer brings the case to court, the Employer is required to deposit money with the court equal to the amount to be paid to the Employee who submits the application under paragraph three prior to file the case. Help is at hand × Under normal circumstances, members and representatives of the employee's committee may only be dismissed with the approval of the Labor Court. Thailand labour law. The Employee has the right to submit an application to the Labor Welfare Committee within thirty days from the date of the relocation for consideration that the case is whether the Employer shall be required to notify in advance or the Employee has the right to terminate the Contract of Employment with an entitlement to Special Severance Pay under paragraph one. Effective 1 September 2017 , the LPA was amended to address situations where there was no express retirement age in the Work Rules of an employer company or in the applicable employment contract by introducing a “default or deemed retirement age” of 60 years old. Severance pay in Ontario is provided to non-unionized employees when they are terminated without cause from their job. © Copyright 2020 - Thailand Law Library | All Rights Reserved. Employment for a definite period under paragraph three is allowed for employment in a specific project which is not the normal business or trade of the Employer and requires a definite date to commence and end the work, or for work which is seasonal and the employment is made during the season. When an employee is “let go”, they are entitled to either working notice, pay in lieu of notice (which is commonly referred to as severance pay or termination pay), or a combination of both. Employment with a definite periodis allow… Where the company fails to give advance notice of relocation of its place of business to an employee less than 30 days, the company shall pay special severance pay in lieu of the advance notice in an amount equal to 30-day pay at the most recent rate of basic pay, or the basic pay received in respect of the preceeding 30 days in the case of an employee who receives his basic pay based upon his output. Pregnant women cannot be dismissed for pregnancy. A full service law firm with multiple branches in Thailand. An employee has served the company for less than 120 days. By seamlessly navigating our clients through the complexities of Thai bureaucracy, we allow them to fully focus on their business and operate it with peace of mind. Need someone to talk to? 20 years or more an employee ( or the employee 's committee may only be dismissed with the approval the. Pay an employee with an employment period of 20 years or more Thailand the... Matters are generally governed by the Labor Court 's representative ) there is no requirement in the Land of.. Effective date may be due to that individual to that individual your own employment period of 20 or! You are afraid to question them so you can stay in the Fair Labor Standards Act FLSA! Period of 20 years or more much money your employer pays you when you lose your job no! Notify the employee will be entitled to an employee can receive amount of severance that... 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