Skip to content
Published
25 October 2019
Read time
2 minutes

Thailand’s new Labour Protection Act increases employee benefits

Businesses in Thailand must be aware of the new act that requires them to provide additional benefits to employees.

Name:

Thailand Labour Protection Act (no 7) B.E. 2562 (2019)

Jurisdiction:

Thailand

Why now?

The new Labour Protection Act came into effect on May 5, 2019 and provides more benefits for employees. The benefit changes affect severance pay, retirement, maternity leave and business leave. 

What’s the business impact? 

The new laws will require businesses to plan ahead for additional funds that may be needed to cover the increased severance pay for employees that have served for more than 20 years. Businesses will also have to budget for more paid time off for certain groups of employees. 

What to do now?

Employers and their HR and payroll departments must take the time to review employment agreements and work rules, as well as employee handbooks. They must ensure that the benefits offered are changed to include the new regulations. Employees also must be informed of the new rules. 

Specifics

  • Severance pay for long-serviced employees has increased from 300 days to 400 days. 
  • Employees can take paid ‘business leave’ for up to 3 working days per year.
  • Maternity leave has increased from 90 days to 98 days with wages paid for 45 days.
  • Employers are required to now pay interest of 15% per year (up from 7.5%) if the employer does not pay wages, overtime payment or other remunerations. 
  • Employers will no longer receive a warning letter to submit forms about employment and working conditions. Instead, if it is not submitted by 31st of January each year, there will be fines up to THB 20,000. 
  • If there is a change of employer due to a condition, such as a merger, the employee must grant the consent for the change or is entitled to severance pay. 

We can help

TMF Thailand provides HR and payroll services to businesses operating in the country and are the experts at understanding the local rules and regulations. Our team can help you with employment consultancy services, reviewing contracts, work rules and handbooks to ensure your business stays compliant with these changes.

Company formation and administration
How royalty income is taxed in Malta

Malta offers unique fiscal incentives to locally-based companies purposely set up to hold intellectual property.

Explore Topic
Man in business suit using digital devices to analyse data
Company formation and administration
3Ts for a global CFO: tax, transformation, today

Growth, new ways to work and to interact with clients, and more resilient operations, are top priorities for businesses around the globe in a post-pandemic era. Finance leaders drive and support related company-wide strategic transformation initiatives. To effectively play their part, finance teams themselves need to transform.

Explore Topic


Expand your business efficiently across borders

Get in touch to find out how we can help your organisation grow in a complex world.

Contact us Contact us