Termination of employment in Thailand | How to terminate an employee ?

Fair Dismissal

There is a distinction between termination of employment with and without cause, as well as termination that is fair and unfair. Because the terms “fair” and “unfair” terminations are not defined in Thai labor law, their meanings are interpreted by the courts based on the facts and evidence presented in each case.

1. Termination of employment with cause

Termination of employment without cause is only permitted in limited circumstances. Reasons for terminating an employee with cause include:

➤ Falsely performing duties or committing a criminal offense against the employer

➤ Intentionally causing harm to the employer

➤ Negligently causing significant harm to the employer

➤ Violating the employer's work rules and regulations or lawful working orders, despite receiving an employee warning letter for the same offense within the previous 12 months (for serious cases, the requirement of a written warning does not apply)

➤ Leaving work without justification for three consecutive working days, whether or not a holiday is taken in between

➤ Being sentenced to imprisonment by a final court decision. If the offence is committed through negligence or is a minor offense, it must be a case in which the employer suffers loss or damage. (Labour Protection Act, Section 119)

In cases where termination for cause is justified, the employer may terminate employment immediately without paying severance.

Statutory minimum notice	None
Severance payment	None

2. Termination of employment without cause

If an employer terminates an employee without cause (which is most often the case), the employer must:

Serve a termination notice at least one pay period in advance, or as specified in the employment contract (whichever is longer). Alternatively, the employer may terminate the employee immediately by paying the employee’s wages in lieu of the advanced notice.

Provide mandatory severance pay ranging from 30 to 400 days, depending on the length of service of the employee, as follows:

120 days, but less than 1 year	30 days
1 year, but less than 3 years	90 days
3 years, but less than 6 years	180 days
6 years, but less than 10 years	240 days
10 years but less than 20 years	300 days
20 years or more	400 days

Unfair Dismissal

In addition to the foregoing, the employee may file a claim for wrongful termination of employment in Thailand. If a terminated employee believes their dismissal was unfair, they can take their case to the labour courts to seek reinstatement or compensation for damages. At its discretion, the court can award compensation in addition to severance pay, payment of salary in lieu of notice, and other amounts due on termination.

The court must examine the following factors while making its decision:

➤ The employee's age

➤ The length of time an employee has been with the company

➤ The employee's job title

➤ The reason(s) for the dismissal

If the court judges a termination to be unjust, it can impose reinstatement or damages if the employee seeks it. Employers should talk with departing employees to reach an acceptable end to the working relationship to avoid charges of unjust termination of employment.

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Grounds for unfair dismissal

On a case-by-case basis, this is dependent on the judges’ assessment of the facts and evidence.

Remedies

If the employee asks it, the court can order his or her reinstatement. If the employer and employee can no longer work together, the court will require the employer to give the employee compensation or damages.

Are redundancies and mass termination regulated?

In general, redundancies and mass layoffs are governed in the same way as other termination situations are. Employers must follow the processes outlined below if employment is terminated due to restructuring connected to the deployment of new technology or machines.

Procedural requirements to terminate an employee

Employers must:

➤ Give a 60-day notice to the labor inspector, indicating the date of termination of employment, the grounds for termination, and the names of employees

➤ Give affected employees 60 days' notice in advance, or pay wages in lieu of notice

Normal severance pay is required for this form of termination of employment, and the business must also pay special severance to all employees who have worked for the company for at least six years.

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