You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

July 5, 2017

Thailand: Amendments to the Labor Protection Act

Subscribe to Updates

The Thai government has focused on updating the Labor Protection Act (LPA) this year. The LPA was first amended on January 24, 2017. More recently, on June 29, the National Legislative Assembly (NLA) has approved further amendments that are now pending Royal endorsement. With the goal of encouraging local businesses and foreign investors to protect employees, the amendments address issues that the LPA did not fully cover in its previous form.

Important provisions in the amendments to the LPA include:

  • The Ministry of Labor’s Wage Committee has the authority to set minimum wages for specific groups, or specific categories of work, businesses, or professionals in different locations.
  • It has always been the case that an employer that has ten or more employees is required to have work rules, and the work rules must specify working days, holidays, and other details stipulated by the LPA. Under the new LPA, an employer is no longer required to send a copy of their work rules or amendments to work rules to the Director General of the Labor Protection Office or a designee. However, the employer is required to:
  1. Announce the implementation of the work rules within 15 days from the date on which the employer has ten or more employees, or amended work rules;
  2. Keep work rules or amendments to work rules on the premises or at their office at all times; and
  3. Openly post work rules or amendments at the employees’ workplace (the employer may also post the work rules or amendments in electronic format for ease of access and review by employees).
  • Retirement in accordance with an agreement between the employer and employee, or as prescribed by the employer, will be deemed as termination of employment.
  • In the event there is no agreement or stipulation on retirement in place, or such agreement or stipulation sets out a retirement age that exceeds 60 years of age, an employee who reaches age 60 is entitled to exercise his or her right of retirement by informing their employer of his or her intention to retire. The retirement will take effect 30 days from the date on which the employee expressed their intention, and the employer must pay statutory severance to the retiring employee.
  • Penalties are increased for certain offenses, including those related to child labor protection.

The new provisions are likely to take effect in the very near future; employers should monitor developments for the effective date, and may wish to review their existing policies for compliance in advance.

Related Professionals

Practices

Employment

Location

RELATED INSIGHTS​

August 23, 2021
Ho Chi Minh City has been locked down for months in an effort to fight the challenging fourth wave of the Covid-19 pandemic. We explore the various options available to employers to cut labor costs, as well as government relief measures to support both workers and employers.
Read More
August 5, 2021
With the latest wave of COVID-19 continuing to have a serious impact on Thailand, many businesses have been looking for ways to survive. Some have temporarily reduced employees’ wages, while others have resorted to a complete or partial halt to operations. In these unprecedented circumstances, it is vital that business owners understand the legal criteria and steps for implementing a temporary cessation of operations in Thailand, as outlined in this article. Any business can apply for a temporary cessation of operations under section 75 of the Labor Protection Act (LPA) if there is a necessity and a significant cause, such as the business being unable to operate as usual, and if the necessity is not considered force majeure under Thai law. (If it is deemed force majeure, an employer may be able to withhold all wages—more on this below.) If these criteria are met, the employer can choose whether to seek temporary cessation of operations on a whole or partial basis, depending on the actual situation and necessity. The employer then has to inform a labor inspection officer and the employees at least three business days in advance of the intended cessation of operations. Once this is done, operations may be halted, but the employer must pay employees at least 75 percent of their wages, calculated based on the rate on their latest working day, and these payments must continue throughout the entire cessation period. “Necessity” and force majeure Though the LPA does not indicate what qualifies as a “necessity” allowing an employer to call for a temporary cessation, past rulings from the Supreme Court provide some guidance on this issue. For instance, reduced purchase orders from customers and financial difficulties faced by the employer can amount to a situation of “necessity.” Additionally, the situation has to be significant
Read More
July 28, 2021
Lawyers from Tilleke & Gibbins’ labor and employment team including Kien Trung Trinh, Sarah Galeski, and Nam Ngoc Trinh have written the Vietnam chapter of Practical Law’s Employment and Employee Benefits Global Guide. The 2021 edition of the handbook provides a high-level comparative overview of employment laws and regulations across 32 jurisdictions around the world. Tilleke & Gibbins also contributed the Myanmar chapter of the guide. The Vietnam chapter covers a wide range of typical employment matters, such as limitations on working hours, paid leave requirements, minimum wage, and health and safety obligations. In addition, the guide provides insight on a number of topics of special interest to foreign investors doing business in Vietnam, including the following: Mandatory contents of a labor contract; Visas and permits required for expatriate employees; Employers’ obligations for protecting employees’ privacy and personal data; Procedural requirements for the dismissal of an employee; Employer and parent company liability. The 2021 edition also includes a special section on Covid-19 related provisions of labor law. To read the Vietnam chapter, click on the link below.
Read More
June 22, 2021
The latest updates to the Employment and Employee Benefits Global Guide, a Thomson Reuters Practical Law online publication that provides an overview of employment and employee benefits in jurisdictions worldwide, includes a revised chapter on employment regulations in Myanmar. The Myanmar chapter was written by members of Tilleke & Gibbins’ Yangon office, including Yuwadee Thean-ngarm, director, Nwe Oo, attorney-at-law, and Sher Hann Chua, consultant. The chapter covers a wide range of key employment topics, including employment status, background checks, regulation of the employment relationship, minimum wage, working hours and holidays, illness and injury of employees, discrimination and harassment, termination of employment, resolution of employer-employee disputes, redundancy/layoffs, employee representation and consultation, business transfer and insolvency, employee relocation, health and safety obligations, taxation of employment income, intellectual property issues, and more. Practical Law, produced by Thomson Reuters, is the world’s leading legal resource for business lawyers, publishing a huge range of guides for hundreds of jurisdictions and practice areas. The Employment and Employee Benefits Global Guide covers 42 jurisdiction around the world, with Tilleke & Gibbins also providing the Vietnam chapter of the guide. To view the latest version of the Myanmar chapter, please visit the Practical Law website.
Read More