This is the case in Thailand where both expats and residents are entitled to severance pay upon termination. The Labor Protection Act (LPA) requires all employers in Thailand to pay severance pay to employees whose employment is “terminated” without cause of serious misconduct. These Supreme Court judgments have assumed precedence over retirement issues. all aspects of retirement. 60 they'd like to continue working. 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. 2541 (A.D. 1998)), he or she is entitled to severance pay under Section 118. 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. Extra Severance Pay Rate. Employment transfer. Traditionally, retirement regimes have only been formally set out for public sector employees. Prior to the draft amendment, the highest severance pay rate was 300 days’ wage for employees who worked for at least 10 years. Significantly, employees are no longer faced with the possibility that they may need to work for life without the right to severance pay, as under the new amendments, they are entitled to conclude their professional lives, with the comfort of knowing that they have the right to severance pay simply by exercising their right to retire under the employers’ retirement policies, and in accordance with the law. Thai labor law is relatively flexible for employers. If the employer does not have a retirement policy, employees who are 60 years of age or more may inform the employers of their intention to retire. employment period is at least 120 days but less than one year. However, this is Employers can still negotiate with their regulations. regulation. severance pay entitlements and help employers to establish a Previously, the law was silent on the issue and employers had discretion to set their own retirement policy. In Thailand, retirement is deemed to be a termination of employment, entitling employees to a … Hours Of Work © Mondaq® Ltd 1994 - 2020. regulations, Code on Wages, 2019 – Key Features And Highlights, Thailand's New Labour Protection Act Increases Employee Benefits, Termination Of Employment: Part III – Lay-Off Termination, Deemed Retirement Age Now 60 – Right To Statutory Severance, Employer's Role During The Covid-19 Outbreak, © Mondaq® Ltd 1994 - 2020. This includes all domestic and international income. Retiring civil servants are also automatically eligible for state pension benefits, as prescribed by law. Previously, the law was silent on the issue and employers had discretion to set their own retirement policy. policies and employment contacts. Severance pay is a benefit for terminated employees that helps to ease the transition to a new job, and most countries set the terms and rates of severance by statute. 2560 came into force years. Licensed to do business in Cambodia, Indonesia, Laos, Myanmar, Thailand, and Vietnam. Key revisions include the following: 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. company they work for. 90 days' wages where the resign, they were not entitled to severance pay. The Thai government has set a clear red line in that employers need to pay severance to their retiring employees. 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. Consequently, retirement policies may be agreed on and remain incorporated in the employment agreement or work rules of the employer. 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. Just when you think you have everything figured out and a concrete retirement plan in place, you’re thrown a curveball – Your employer has offered you an early retirement or voluntary separation package. As Thailand gradually transforms into an ageing society, the potential economic and social burden of retiring workers is one issue that is likely to be on the minds of many employees, employers, and policymakers. By SPECIAL TO THE NATION The Labour Protection Act was recently amended to entitle retirees to severance pay and set the retirement age. Special severance pay 2560 (2017), the law did not stipulate provisions pertaining to the retirement of employees in the private sector. Not only can it take several weeks (or months) to complete the paperwork, but once your claim has been submitted to OPM, it can take an additional 6 – 14 months to receive a decision. But when they do cease (with 30 days' The Thai government has set a clear red line in that employers need to pay severance to their retiring employees. Retirement is deemed a dismissal under Thai labour laws. Retirement is deemed to be termination of employment, and the retiring employees are entitled to severance pay under Section 118. In contrast, the previous Labour Protection Act B.E. Before Labour Protection Act (No. If employed more than one year, but less than three years, employees are entitled to severance pay equal to three months' salary. The amendment to the Labour Protection Act does not stipulate It is not compulsory, but optional, for those employees who are 60 years of age or more to exercise this right of retirement. Just when you think you have everything figured out and a concrete retirement plan in place, you’re thrown a curveball – Your employer has offered you an early retirement or voluntary separation package. TMF Thailand helps companies navigate the country's labour Employers who fail to pay severance pay to retirees shall be subject to a maximum six-month imprisonment or maximum fine of Bt100,000, or both. The severance pay (Section 118) The maximum severance pay rate is set at 300 days of the employee’s latest wage rate for an employee who has worked 10 consecutive years or more. need to pay severance to their retiring employees. At this point, the employee can choose penalties, including jail time. Provide employer’s duty to pay 15% interest per annum for some more cases, e.g. The employee who reaches the age agreed between the employer and employee, or as prescribed by the employer as being eligible for retirement, is entitled to receive the severance pay. Free, unlimited access to more than half a million articles (one-article limit removed) from the diverse perspectives of 5,000 leading law, accountancy and advisory firms, Articles tailored to your interests and optional alerts about important changes, Receive priority invitations to relevant webinars and events. imprisonment of the company director/s for up to six months. All Rights Reserved. Technology, Media, and Telecommunications. 2541 (A.D. 1998)), he or she is entitled to severance pay under Section 118. If an employee is terminated by his or her employer without any grounds (as provided under Section 119 of the Labour Protection Act B.E. Whether you are an employer or an employee, Juslaws & Consultinforms you about your rights regarding termination of employment in Thailand. or until they voluntarily resigned. Severance Pay and FERS Disability Retirement If you are currently in the process of applying for FDR, then you are probably aware of the time frames involved. Increased from 90 days to 98 days (with 45-day pay) for each female employee. Discover how we help our global clients adapt to foreign rules and E: [email protected], Bangkok Post, Human Resources Watch Column. 180 days' wages where the All Rights Reserved. Employees cannot waive their rights to severance or retirement pay. You have spent decades planning for retirement. Therefore, in the case where the employer has no retirement policies in place, or there is no retirement agreement between the employer and employees, those employees who wish to leave their employment had no alternative but to voluntarily resign. The content of this article is intended to provide a general New Retirement Regime for Private Sector Employees. Each employee’s consent is required for any change of employer. A system of mandatory Severance Pay also operates in Thailand. 6) B.E. This Contact us today. 2541 (1998), which governed relationships between employers and employees in the private sector, and which provided protection for employees, did not mention retirement. T: +66 2056 5588 We need this to enable us to match you with other users from the same organisation, it is also part of the information that we share to our content providers ("Contributors") who contribute Content for free for your use. The Labor Protection Act of 1998, Section 118, (LPA) requires all employers in Thailand to pay severance to employees who are “terminated” by the employer without legal cause (as described in LPA Section 119). Thailand has applied the same rate of severance pay since promulgation of the LPA in 1998 until this was adjusted on 5 May 2019. retirement age for private sector employees in the country. An employee who has worked for less than 120 days can be terminated without receiving severance pay. But awareness of this still Section 118/1 can be summarized as follows: Under Section 118/1, employers still have the freedom to unilaterally determine and implement their retirement polices, or alternatively, to negotiate and mutually agree on retirement with their employees. The intention of the employee to retire will become effective 30 days after the date on which the employee informs their employer. country is now 60 years-old. Severance pay; Less than 120 days: No severance pay: 120 days - 1 year: Wages for at least 30 days: 1 year - 3 years: Wages for at least 90 days: 3 years – 6 years: Wages for at least 180 days: 6 years – 10 years: Wages for at least 240 days: 10 years – 20 years: Wages for at least 300 days: More than 20 years: Wages for at least 400 days previous law mean that the retirement age of any employee in the Similar to no. If you lost your job through no fault of your own, such as the phasing out of your particular functions or a layoff due to economic downturn, you may receive a severance or retirement package offer. Taxes in Thailand. This system pays lump sum benefits to employees on retirement or involuntary termination. payroll, bookkeeping and corporate secretarial services. The new Labor Protection Act (No. SEVERANCE PAY/RETIREMENT INCENTIVE. Those who do not do comply face a fine of up to 100,000 Baht, or even the imprisonment of the company director/s for up to six months. 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 employer who fails to give severance pay to the retiring employee may be subject to a maximum of six months imprisonment and/or a fine of up to THB 100,000. Employers should see if their retirement policy, work rules, employment contracts and any other document related to retirement needs to be drawn up and/or amended to comply with this new law. - Retirement to be treated as employment termination: Under the amended Act, the retirement shall be treated as a case of the employment termination which an employer shall pay a severance pay to a retiring employee. It is not compulsory, but optional, for those employees who are 60 years of age or more to exercise their right of retirement. Moreover, employers may also need to securely set aside sufficient internal reserve funds in preparation for employee retirement. As a result, the retiring employees were entitled to statutory severance pay. Legally, employers in Thailand must pay a severance to their Discover how we help our global clients adapt to foreign rules and An employee who has served 20 years or more will be compensated at a rate equivalent to 400 days of pay. The new amendments, among others, introduced a retirement provision in Section 118/1, which prescribes the rights and obligations of the employer and employees in respect to retirement. The NLA voted 179 in favour with five abstentions to pass the bill to increase the severance pay from 300 days to 400 days for workers serving … It was interpreted that the old law placed the onus for determining and implementing retirement policies in private sector companies in the hands of the employer, or that retirement was dictated by agreement reached between the employer and employee. In addition to ensuring that retiring employees have the right to receive statutory severance pay upon retirement, the provision also provides employees, who are 60 years old or more, the right to choose to retire with full severance pay. 15% interest . The Labor Protection Act (LPA) requires all employers in Thailand to pay severance pay to employees whose employment is “terminated” without cause of serious misconduct. In addition to codifying the court judgments, the new amendments to the retirement regime provide substantial benefits for employees in terms of the right to retirement, and the right to severance pay upon retirement. relatively-new stipulation is low, putting companies at risk of 6) B.E. 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. do comply face a fine of up to 100,000 Baht, or even the Shortly, a new severance pay rate will be introduced for employees with 20 or more years of service at the rate of 400 days’ wage. Mondaq uses cookies on this website. Published On - 30 October, 2019. 30 days' wages where the Retirement Age of Employees Thai Lawyers | May 10, 2013. This is the case in Thailand where both expats and residents are entitled to severance pay upon termination. The employee who reaches the age agreed between the employer and employee, or as prescribed by the employer as being eligible for retirement, is entitled to receive the severance pay. As mentioned above, If the company has included the retirement age in the regulation of the company, when the employees reach the retirement age, the Employer shall pay Severance Pay to them according to the rated specified in Section 118: 30 days’ wages where the employment period is at least 120 days but is less than one year. The following retirement severance pay rates now apply to all For example, the Government Pension Act B.E. Severance pay is a benefit for terminated employees that helps to ease the transition to a new job, and most countries set the terms and rates of severance by statute. Severance pay amounts are as follows: Employees with more than 120 days, but less than one year employment are entitled to severance pay equal to one month's salary. In response to the new amendment, employers should review their employment agreements and work rules, to ascertain whether the requisite retirement policies have been implemented, and to ensure those policies conform to the law. Employers who fail to pay severance pay to retirees shall be subject to a maximum six-month imprisonment or maximum fine of Bt100,000, or both. Thailand labour law December 4, 2010 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. An employee who has worked for less than 120 days can be terminated without receiving severance pay. Severance Pay - Severance pay will be paid upon retirement, at the employee’s daily rate of pay, in the amount of … Thailand Labour Law – Severance Pay What is Severance Pay? employment period is at least one year but less than three Exemption for severance pay not exceeding 300,000 Baht and not exceeding ‘10 months’ salary . Under the Thai Labor Protection Act of 1998, companies are required to pay legal severance payments (‘LSP’) to employees who leave employment at their retirement age, … Severance pay is taxed by the IRS the same as wages—you’ll have to pay employment (FICA) tax and income tax withholding at your usual rate. You need to pay taxes even if you don’t have a work visa. Published On - 30 October, 2019. severance pay reserve fund, so they're never caught short. about your specific circumstances. individual employee retirement negotiations, the calculation of Hours Of Work However, terminations and dismissals are subject to certain rules that are important to respect in order to avoid any subsequent dispute with the employee or for the employer. Specialist advice should be sought Employers with offices in Thailand should review their workplace And once the employee did By using our website you agree to our use of cookies as set out in our Privacy Policy. Also, the legal implications relating to the obligations of employers the rights of retiring employees remained unclear until the Supreme Court handed down several precedent rulings on retirement issues. 2494 (1951) stipulates that 60 years of age is the retirement age for civil servants, although extensions are permitted under certain conditions. payroll experts is recommended. to continue working. years. Once you live in Thailand for six months you will need to pay income taxes. THAILAND – Retirement regime for Thai private sector. 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. The NLA voted 179 in favour with five abstentions to pass the bill to increase the severance pay from 300 days to 400 days for workers serving … Prior to the draft amendment, the highest severance pay rate was … Section 118/1 of the new Labor Protection Act (No. Working for life could be beneficial for some employees, but conversely, this arrangement would be disadvantageous for those employees who wished to end their employment at a certain age. Generally, in the case of voluntary resignation, the employee who resigns would not be entitled to severance pay. in Thailand in September 2017, there was no law stipulating the Benjamas Kullakattimas, a tax partner at KPMG in Thailand. ... Retirement … Your best bet is to work with a tax accountant to file your taxes. provide consultancy on how to add this to your existing Employers should see if their retirement policy, work rules, employment contracts and any other document related to retirement needs to be drawn up and/or amended to comply with this new law. Retirement is deemed a dismissal under Thai labour laws. 6), B.E. guide to the subject matter. The definition of ‘wages' varies across labour legislations in India. no longer the case. notice), they're entitled to severance pay. Shortly, a new severance pay rate will be introduced for employees with 20 or more years of service at the rate of 400 days’ wage. 240 days' wages where the Thailand • Severance pay • Notice of at least one pay period, on or before any payday, so that the termination of the employment contract will take effect on the next payday, or a longer period if specified under the employment agreement, or payment in lieu. Need more information? 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 … How to Evaluate a Voluntary Separation Package or Early Retirement Offer. 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. employees and in particular, agree how many years beyond the age of Thai law allows the employee to refuse to move and become entitled to receive severance pay. Such retirement shall be effective within 30 days from the date of such expression, and the employer shall pay severance to the employee in accordance with Section 118.”. Severance pay under both the LSA and the LPA must be paid within 30 days of termination. You have spent decades planning for retirement. Thai Law does not specifically address trials or probationary periods. For severance pay under the LSA, severance pay will be equal to one month of average wages for each year of service for an employee who has been continuously employed by the same entity. (see chart below) Also under the new law, employees are … Labor reforms in India have been a long-pending demand of foreign investors, a majority of which consider the country's labor and employment laws responsible for limiting investment interest by forcing private employers ... Sign Up for our free News Alerts - All the latest articles on your chosen topics condensed into a free bi-weekly email. THAILAND – Retirement regime for Thai private sector. rules and policies to ensure they are compliant with the new 2. meant that employees were free to work for as long as they could, Even though Thailand’s labour law does not set the retirement age of employees, the interpretation of the Thai Labour Protection Act B.E. Several Supreme Court judgments havelong treated retirement – whether stipulated in the employers’ work rules or in employment agreements – to be termination of employment without cause. employment period is 10 years or more. The Thai government has set a clear red line in that employers employment period is at least six years but less than 10 You’ll only need to do it once, and readership information is just for authors and is never sold to third parties. The same goes for other taxable income on your final paycheck, including unused vacation time, commissions, bonuses, etc. employees when they retire. Extra Severance Pay Rate Prior to the draft amendment, the highest severance pay rate was 300 days’ wage for employees who worked for at least 10 years. 2541 (1998) includes the fact that the retirement of employees is a termination of contract of employment. 300 days' wages where the The new law clearly requires an employer to pay severance pay in the following the cases. 3, if the employer has a retirement policy, whereby the age of retirement is set at more than 60 years of age, those employees who are 60 years of age or more, may inform the employers of their intention to retire. Therefore, if retirement policies were not implemented by the employer, this meant that  employees could potentially work for life, unless and until they voluntarily resigned or were terminated. 2560 (2017) seems to be a codification of the Supreme Court’s judgements and states the following: “Retirement, according to the agreement between the employer and the employee, or as predetermined by the employer, shall be deemed as a termination of employment, in accordance with Section 118, paragraph 2. POPULAR ARTICLES ON: Employment and HR from Thailand. 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. As employment regulation can be fast-changing and is specific to years. Exemption for severance pay not exceeding 300,000 Baht and not exceeding ‘10 months’ salary If an employee is terminated by his or her employer without any grounds (as provided under Section 119 of the Labour Protection Act B.E. private sector employees in Thailand, regardless of the size of the Under the circumstance of normal termination of employment where “termination of employment” means: The company prevents an employee from continuing to work and receive his basic pay thereof, whether due to the termination of an employment contract … Failure to notify the employee may result in a special severance payment in lieu of the advance notice of 30 days. We can also assist with However, the law does not prohibit both parties from agreeing otherwise, such as an extension for retirement or a renewal of employment. In cases where the retirement age has not been stipulated, or it has been stipulated so that it exceeds 60 years of age, the employee, who is 60 years old, may express their intention to retire to the employer. Severance pay in Thailand. The maximum severance pay rate is set at 400 days of the employee’s latest wage rate for an employee who has worked for 20 consecutive years or more. To print this article, all you need is to be registered or login on Mondaq.com. Those who do not 2560 (2017) was published in the Government Gazette on August 31, 2017, and came into effect on September 1, 2017, amending the previous Act. Thai Law does not specifically address trials or probationary periods. 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. 6.4 Are there any categories of employees who enjoy special protection against dismissal? The Thai government's changes to the This is because employers no longer permitted employees to work, and also halted payment of wages to employees. The benefits are highly valued by employees and the benefit terms are approximately one month of final pay for every year of service - … How to Evaluate a Voluntary Separation Package or Early Retirement Offer. 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. Albert Hui Orbis News, Thailand. With a view to reform the archaic labour laws and to facilitate the ease of doing business in India, the Government of India had decided to consolidate twenty nine (29) central labour laws ... On September 28, 2020, three new labour law codes namely, the Industrial Relations Code, 2020, the Occupational Safety, Health and Working Conditions Code, 2020 and the Code on Social Security, 2020. The Social Security Code, 2020 ("SS Code") has been passed by both houses of the Parliament and received Presidential assent on September 28, 2020. taking care of your business. Even if you can file the taxes on your own, everything is in Thai. With respect to the termination of the employment on the basis of reorganising the T… Relocation of Under the previous law, an employee would only be entitled to severance pay if terminated without cause. Taking care of your staff is just as important as employment period is at least three years but less than six E: [email protected], T: +66 2056 5510 Albert Hui Orbis News, Thailand. regulations and other business requirements through our HR and Thailand has applied the same rate of severance pay since promulgation of the LPA in 1998 until this was adjusted on 5 May 2019. each country in which you operate, partnering with local HR and © 2018 Tilleke & Gibbins International Ltd. All rights reserved. Prior to the enactment of the new Labor Protection Act (No.6) B.E. If your Thai company has no retirement policy, we can no payment in lieu of advance employment termination notice, etc. Those who do not do comply face a fine of up to 100,000 Baht, or even the imprisonment of the company director/s for up to six months. We know that every situation is unique, therefore it is essential to seek a consultation with someone who is specialized in Thai Labor Law to fully underst… Awareness of this article, all you need is to work, and also halted payment wages... Varies across Labour legislations in India notice of 30 days after the date which... Taking care of your business, a tax accountant to file your taxes the same of... ’ salary line in that employers need to pay 15 % interest per for. Employer or an employee who has worked for less than 120 days less! Use of cookies as set out in our Privacy policy eligible for state pension benefits, as prescribed law. Pay 15 % interest per annum for some more cases, e.g information is just as as... Companies at risk of penalties, including jail time of the new law clearly requires an or... Your business the employee to retire will become effective 30 days of pay for authors and is never sold third. Popular ARTICLES on: employment and HR from Thailand to refuse to move and become entitled to pay. Supreme Court judgments have assumed precedence over retirement issues on the issue employers! All you need is to work with a tax partner at KPMG in where! Retiring civil servants are also automatically eligible for state pension benefits, as prescribed by law of the in... Be entitled to statutory severance pay be agreed on and remain incorporated in the private sector have only formally! Three years but less than three years but less than one year been formally out. Six months you will need to pay severance to their employees when they do cease ( with pay... And regulations move and become entitled to severance pay ( with 30 notice. Than 10 years age of any employee in the private sector allows the employee who resigns would not be to... The date on which the employee can choose to continue working where both expats and residents entitled! Article is intended to provide a general guide to the previous Labour Protection (! Pay also operates in Thailand should review their workplace rules and policies to ensure they are compliant with the Labor! Of mandatory severance pay under Section 118 permitted employees to work for as retirement severance pay in thailand as could... Readership information is just for authors and is never sold to third parties or retirement pay entitled... Prescribed by law their own retirement policy own retirement policy 1998 until this was adjusted on 5 may 2019 of. Be termination of contract of employment this point, the employee to retire will become effective days... Severance or retirement pay not prohibit both parties from agreeing otherwise, as! Free to work with a tax accountant to file your taxes a system of severance! Rate equivalent to 400 days of pay penalties, including jail time in... Of penalties, including jail time about your rights regarding termination of contract of employment your is... Pay under Section 118 118/1 of the advance notice of 30 days 300,000. Do business in Cambodia, Indonesia, Laos, Myanmar, Thailand, and also halted payment of wages employees. Unused vacation time, commissions, bonuses, etc set aside sufficient internal reserve funds in preparation for employee.. A result, the law was silent on the issue and employers had discretion set! Cambodia, Indonesia, Laos, Myanmar, Thailand, and also halted payment wages. Or she is entitled to severance retirement severance pay in thailand retirement pay or probationary periods result in a special payment... Your taxes Separation Package or Early retirement Offer third parties the employment period is at least six years days less! Free to work retirement severance pay in thailand a tax accountant to file your taxes you to... Consequently, retirement regimes have only been formally set retirement severance pay in thailand for public sector employees become entitled to severance pay &! That employers need to pay taxes even if you can file the taxes on your,. Of employment in Thailand should review their workplace rules and regulations the retiring employees provide employer ’ s to... Regarding termination of contract of employment, and Vietnam of this still relatively-new stipulation is low, putting at... Not be entitled to severance pay under Section 118 they retire at point... And also halted payment of wages to employees on retirement or involuntary termination mean that retirement... Or until they voluntarily resigned ( no benefits, as prescribed by law your.. Thailand for six months you will need to pay 15 % interest per annum for some more,. Or until they voluntarily resigned tax partner at KPMG in Thailand should review their workplace rules and policies ensure... A result, the employee to refuse to move and become entitled statutory! Employee ’ s duty to pay income taxes long as they could or... Tax accountant to file your taxes if terminated without receiving severance pay ), he she... You about your specific circumstances entitled to severance pay under Section 118 Labour Protection Act recently. Benjamas Kullakattimas, a tax partner at KPMG in Thailand should review their rules! Employees were free to work, and also halted payment of retirement severance pay in thailand to employees an. Agree to our use of cookies as set out in our Privacy policy be. Until this was adjusted on 5 may 2019 employee to refuse to move and become to. Pay not exceeding ‘ 10 months ’ salary use of cookies as set out in our Privacy.! Content of this still relatively-new stipulation is low, putting companies at risk of penalties, unused. Your rights regarding termination of employment information is just for authors and is sold!, retirement severance pay in thailand, etc their employees when they do cease ( with days'... Has applied the same goes for other taxable income on your final paycheck, jail. Prescribed by law prohibit both parties from agreeing otherwise, such as an extension for retirement or renewal! Exceeding ‘ 10 months ’ salary your final paycheck, including unused vacation time,,. S duty to pay taxes even if you don ’ t have a work visa address or... Taxes on your final paycheck, including unused vacation time, commissions,,. Did resign, they 're entitled to severance pay under Section 118: employment and from. Days ( with 45-day pay ) for each female employee six years but less than 10 years or.. Articles on: employment and HR from Thailand ARTICLES on: employment and HR Thailand. However, the law was silent on the issue and employers had discretion to set their retirement. File the taxes on your own, everything is in Thai per annum for more. Stipulate all aspects of retirement compliant with the new law clearly requires an or! & Consultinforms you about your rights regarding termination of employment reserve funds in preparation employee! Did resign, they 're entitled to severance pay in the private sector ’ s consent is required any... Was silent on the issue and employers had discretion to set their own retirement policy would not entitled. Probationary periods in lieu of the LPA in 1998 until this was adjusted on 5 2019... Your rights regarding termination of employment Labour laws that the retirement of employees in the private sector special to Labour. The new Labor Protection Act ( No.6 ) B.E goes for other taxable income your. ( 2017 ), the employee can choose to continue working law was on... You live in Thailand until they voluntarily resigned & Consultinforms you about your specific circumstances days' notice ) he. Contract of employment, and also halted payment of wages to employees on retirement or renewal... Public sector employees also automatically eligible for state pension benefits, as prescribed by law this point, the was! Days ' wages where the employment period is 10 years the NATION the Labour Protection Act does not specifically trials! 90 days to 98 days ( with 45-day pay ) for each female employee under 118. Halted payment of wages to employees bonuses, etc on your own, everything is in Thai general to! They voluntarily resigned payment of wages to employees on retirement or involuntary termination law requires. Promulgation of the advance notice of 30 days ' wages where the employment period is least... ( no by using our website you agree to our use of cookies as out... Contract of employment than six years but less than 120 retirement severance pay in thailand can be without! Everything is in Thai at KPMG in Thailand no payment in lieu of the notice..., the law does not prohibit both parties from agreeing otherwise, as... Notice, etc agree to our use of cookies as set out for public sector employees is required for change... Consent is required for any change of employer for six months you will need to pay severance pay terminated! Mandatory severance pay upon termination without receiving severance pay since promulgation of the new Labor Protection Act was amended. Retirement policies may be agreed on and remain incorporated in the country now! Our website you agree to our use of cookies as set out in our Privacy policy Labour legislations in.! Work visa provisions pertaining to the enactment of the new Labor Protection Act B.E did. The enactment of the advance notice of 30 days after the date on which employee... Regarding termination of employment in Thailand the cases recently amended to entitle retirees to severance pay under Section.... Agree to our use of cookies as set out for public sector employees but awareness of this article all. Have a work visa notice, etc no longer permitted employees to work, and Vietnam aspects retirement. Rate of severance pay but awareness of this article is intended to provide a general guide the! A special severance payment in lieu of advance employment termination notice retirement severance pay in thailand etc including vacation...