Shield GEO can contract directly with the company to employ and payroll their staff in Thailand. Shield GEO supplies local employment contracts for the staff which ensure that local statutory requirements are met covering issues such as termination, probation periods, leave entitlements and statutory benefits. Shield GEO is able to advice companies how to cover local employment regulations whilst still providing consistent global employment policies. Understand more about outsourced employment through Shield GEO.
Thailand labour market is governed by strict rules and regulations. It’s important that appropriate advice is sought out based on the business structure that would be established in Thailand.
Some of the rules and regulations that govern Thai labour market include:
For these and many other reasons the following are only guidelines in the broadest sense, and professional legal services are recommended when employing in Thailand.
Key points on employment
There are several key areas to be aware of within Thailand’s employment regulatory framework, especially for companies that plan to initiate a full local office and human resources department. These challenges can be mitigated by use of a locally sourced payroll provider who is familiar with all of the local laws and rules for both local employees as well as foreign nationals.
An employment contract can be written or verbal as per the Labour Protection Act. Thai Civil and Commercial code and the Labour Protection Act stipulate the following statutory entitlements be included in employment contracts.
Different types of employees based on nature of employment contract:
Part time workers:
|Time Off Work ?||
An employee is entitled to a minimum of 6 days of annual leave after working consecutively for one full year. For an employee who has not completed one year of service, the employer may provide an annual leave on a pro-rate basis.
|Medical Leave ?||
An employee is entitled to take sick leave with 30 days of paid sick leave per year. An employer may request a medical certificate if an employee is absent for three consecutive days. Days on which the employee cannot work because of injury or illness caused by work shall not be deemed sick leave.
|Severance / Redundancy Pay ?||
An employee can be terminated without a specific cause and subject to all payments including severance pay, unused annual leave, overtime pay, and other payments due under the employment agreement within 3 days from the termination of employment.
Severance pay rates vary based on the length of employment.
Severance pay rate Work period
30 days pay 120 days – less than 1 year
90 days pay 1 year – less than 3 years
180 days pay 3 years – less than 6 years
240 days pay 6 years – less than 10 years
300 days 10 years and over
Severance pay is not made if:
Conditions under which there would be non-severance payment:
Conditions under which a special severance would be paid:
|Termination of Employment ?||
Either party to an employment contract can give at least 1 days of notice and terminate employment, if the employment contract does not specify such terms. If an employee is dismissed for a statutory reason, such reasons should be kept on record. An employee may not be dismissed for due to the following reasons:
Under the Labour Court’s Act, a Labour Court can re-instate an employee at the same wage rate that applied prior to the dismissal. However, if the Labour Court determines that the employer and employee cannot work together due to specific conditions, then it may order the employer to pay compensation.
Ceasing operations temporarily:
When employers encounter this issue the affected employees can be paid at a reduced rate of 25% of their normal pay rates.
Includes 4 categories
Compensation amount should be paid monthly at the rate of 60% of the monthly wages. Medical expenses must be paid out and should not exceed 45,000 Baht for formal cases and 65,000 Baht for serious injuries. Work rehabilitation expenses should not exceed 20,000 Baht. In case of death, funeral expenses should be paid at a maximum amount equal to 100 times of the minimum daily wage prescribed by the law.
Compliance with local employment requirements is just one of the issues foreign companies face when employing staff in Thailand. For companies which intend to employ their staff directly through their incorporated Thailand entity, professional legal advice is recommended. Shield GEO provides an alternative path for companies to outsource the employment of their staff in Thailand.
As a Global Employer Organization (GEO), Shield GEO acts as the Employer of Record and ensures the employment is compliant with host country regulations regarding employment. In addition Shield GEO will handle payroll processing, tax and immigration. Using Shield GEO is the fastest and most cost effective way to deploy local and foreign workers into Thailand.
The Shield GEO solution is an attractive alternative where
– the company is looking to employ staff quickly
– the company doesn’t have an appropriately incorporated entity in Thailand
– the company wants to work within a defined budget
– the company wants to limit its initial commitment in Thailand
– the company needs help with tax, employment, immigration and payroll compliance in Thailand
Shield GEO can contract directly with the company to employ and payroll their staff in Thailand. Shield GEO supplies local employment contracts for the staff which ensure that local statutory requirements are met covering issues such as termination, probation periods, leave entitlements and statutory benefits. Shield GEO is able to advise companies how to cover local employment regulations whilst still providing consistent global employment policies. Understand more about outsourced employment through Shield GEO.
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