84/2015 dated 3rd July 2015) severance pay in thailand thai labour law restricted jobs for foreigners social security in thailand double taxation agreement tips for paying taxes as a foreigner. An employer shall pay severance pay to an employee whose employment is terminated, as follow: An employee who has worked for at least 120 consecutive days, but for less than one year shall be paid basic pay for 30 days at the most recent rate of basic pay received by him Thai labour law provides that in the event that an employee violates an employer’s work rules, regulations or orders in circumstances where the employer has previously issued a warning letter to the employee in respect of the same violation, the employer may terminate the employee’s employment without severance pay. Retirement Age of Employees Thai Lawyers | May 10, 2013. 90 days’ wages where the employment period is at least one year but is less than three years. However, under Thai Law, only employees who have worked for 120 days or more are entitled to severance pay if they are terminated without cause. The obligation to pay severance pay to fixed-term employees By Johan Botes, Director, Employment Law, Cliffe Dekker Hofmeyr. The issue of retrenchments in general and of assessing severance pay in particular are practically complicated and fraught with legal complexities. Under Thai labour law, an employer may terminate an indefinite term employment contract immediately, without notifying the employee at least one payment cycle … If the employer has a retirement policy, or the employer agrees with the employee on retirement and the age of retirement, both parties are required to comply with such policy or agreement. 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 period prescribed under Section 70, or severance pay under Section 118, special severance pay in lieu of advance notice, or special severance pay under Section 120, Section 121 and Section 122, the Employer shall pay interests to an Employee at the rate of … Amendments The amendments to the Labour Protection Act have been made to confirm the court’s rulings that retirement is considered as a termination of employment. wrongful dismissal in thailand Employers are therefore not advised to deal with these without the assistance of an experienced and reputable labour law advisor. An employee who has worked for less than 120 days can be terminated without receiving severance pay. Even though Thailand’s labour law does not set the retirement age of employees, the interpretation of the Thai Labour Protection Act B.E. Severance Pay. save on lawyer fees, save on travel time. 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. Section 14. Thai law allows the employee to refuse to move and become entitled to receive severance pay. All sounds fine from what I've read about Thai labour law. Employment law 'labour protection act' rights and liberties individual employer and employee, ... Thai legal for expats . statutory severance pay at the rate set out by the Labour Protection Act 1998 (“LPA”) (which ranges from 30 to 300 days’ wages depending upon length of service) to an employee whose employment is terminated without reason or for reasons other than those set out in Section 119 of the LPA. The basic presumption of Thai Labor Law is that the Employer is in a superior position in relation to the Employee therefore Employees require the law to equalize the imbalance of power. According to Section 17 of the Labour Protection Act B.E. If the period of … The employer shall make the severance payment to the employee not later than two months from the receipt of such a notice. Paying income tax on lump-sum severance payments. 2541 (1998), as well as the Foreign Employment Act. But, and this is very important, a severance or ex gratia payment was not compulsory under Thai labor law before 1 September 2017. For example, you may pay less tax if you get your severance pay as a salary continuance instead of as a lump-sum payment. They are however claiming that only the 'base salary' qualifies for severance pay. 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. As a result, to avoid paying severance, many employers in Thailand set probation periods of up to 119 days. Working hours This article addresses several of the most important aspects of this Act and its Regulations. “(5) to issue an employer to pay for special severance pay instead of a given advance notice or special severance pay under section 120/1”. This would lead to voluntarily resignation and this resulted in employees being unable to claim severance pay under Thai law. 2541 (1998) includes the fact that the retirement of … 28 February 2020. New Rate of Severance Pay; An employee who has been terminated without cause will be entitled to, among others, severance pay; the rate of which depends on an employee’s length of service and last wage rate. BY lvan lsraelstam, Chief Executive of Labour Law Management Consulting. *Under the Amended LPA, an employee who works for more than 10 years but less than 20 years will continue to be paid severance pay for 300 days of the last wage rate, but if the employee works for at least 20 years, the amount of severance pay will be increased from 300 to 400 days of the last wage rate. In the case where an employer relocates the place of business in Thailand which affects the normal living of an employee or his/her family, the employer shall notify the employee at least 30 days before the date of relocation. Offences and Penalties An employer who without reasonable excuse fails to pay severance payment to an employee is liable to prosecution and, upon conviction, to a fine of $50,000. Special Severance Pay. The Labor Protection Act regulates minimum standards for pay and working hours for employees. A look at the key legal provisions governing the termination of employment in Thailand, including grounds for dismissal, notice requirements and severance pay, among other things. So you think it is all fun and games. How much tax you pay depends in part on how your employer pays your severance pay. Years Months (A) Weeks of Severance Pay Due If you get your severance pay as a lump sum, your employer will deduct the income tax. 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. The latest manifestation was revision to the Thai LPA was in 2010. This means that the effective date may be delayed. tax submission forms in thailand. There is a lot of misunderstanding about the Thai labour law, the labour court and teachers' rights in Thailand. See ESA section 57 and 58. business tax & tax rates in thailand. However, it does specify severance pay for employees who have worked for 120 days or more and are terminated without cause. My employer has said I'm entitled to 6 months severance pay. termination of employment. You believe what the schools tell you and you are afraid to question them so you can stay in the Land of Smiles. approved by the Commissioner for Labour. Thailand has applied the same rate of severance pay since promulgation of the LPA in 1998 until this was adjusted on 5 May 2019. In this article I will outline the aspects of the Thai labour law concerning teachers in Thailand as covered by the Labour Protection Act, B.E. Thai Labour Law; Employers beware: The Labour Protection Act gets serious . Keywords: Labour Law, Termination, Thailand, Employee. Thai law does not explicitly mention probationary period in employment relationships. 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. The provisions of section 118 (5) of the Labour Protection Act B.E. Hours Of Work The law provides maximum working hours based on the type of work. Previously, the law was silent on the issue and employers had discretion to set their own retirement policy. 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