Vital Information for Employers in Thailand During the COVID-19 Outbreak

​As the Covid-19 situation remains fluid many business and employees are finding it difficult to cope or even find relevant information on how to cope with this escalating situation and the business impact it is having on employers and their employees globally.

We have put together a current Employer’s guide to helping cope with the virus containment measures and how the Labor Law in Thailand has regulations in place to deal with many current situations’ employers are currently challenged with in Thailand as follows:

Commonly Asked Questions:

Quarantined Employees identified by the Thai Government for being in a high-risk category.

The employer has the right to withhold from paying salaries to the employee during the quarantine period, under the premise of “no work no pay.”

Thailand employees both Thai and Foreign Nationals are identified as having COVID-19 taking sick leave

The employer is required by law to pay salaries to such employees, but not exceeding 30 days in a year. The company has the right to also ask for a Medical Certificate from such employees to pay out sick leave as prescribed above.

Thai Government issuance of mandatory directives requiring the employer’s business to temporarily close down

The employer has the right to withhold from paying salaries to the employee during the quarantine period, under the premise of “no work no pay.”

The employer decides to voluntarily temporarily stop normal business operations without under a mandatory directive from the Thai authorities.

In such instances where the outbreak impacts the employer’s business, the employer may decide for a temporary stoppage of their normal operations. An example of this would be where an employer has seen a significant drop from normal business demands and the company decides to put their employees on a part-time employment period.

Under section 75 of the Labor Protection Act an employer is entitled to temporarily stop their normal business operations, during which time they are required to pay least 75% of their regular working-day wages, subject to the following conditions:

  • There is a necessity and a significant cause for the employer to take this step, such as the employer’s business being unable to operate as usual.
  • The necessity is not considered to be force majeure under Thai law. If an event is deemed to have arisen due to a force majeure event, the employer is entitled to forgo paying salaries to employees.
  • The employer has to decide whether to seek a temporary stoppage of operations on a whole or partial basis.
  • The employer has to inform the labor department officer, and the employees, 3 business days in advance of such a stoppage decision.
  • The employer has to pay employees throughout the entire period of cessation.
  • The cessation period depends on the situation on a case-by-case basis. Once the previously cited reason for cessation of operations has subsided, making the measure no longer necessary, the employer has to cancel the cessation measure.

The Thai Labor Protection Act does not clearly indicate what qualifies as a “necessity” for employers to implement the decision. Former Thai Labor court history cases do however provide some guidance, indicating that both (1) a reduction in customer purchase orders and (2) financial difficulties faced by the employer are viewed as situations of necessity. Furthermore, the situation has to be significant and must seriously impact the employer’s business. It cannot be a result of the employer’s own failure to conduct business as in normal situations.

Decision for Employee Lay Offs / Terminations

Under Thai labor law, if the COVID-19 virus impacts the employer’s business to the point that the business cannot operate, the employer may terminate or lay off employees, but must adhere to the following conditions

  • Employees must be informed of the planned layoffs at least one pay period in advance, in accordance with Labor Law. Otherwise, the employer is required to pay remuneration in lieu of advance notice. If relevant employment contracts or work rules state a longer period for informing the employee of layoffs, the employer must comply with their respective employment contracts.
  • Severance Payments depends on each employee’s length of service, from 30 days’ pay at the employee’s most recent wage rate for those who have worked with the employer for at least 120 days consecutively, but less than one year; up to 400 days’ pay for employees who have worked with the employer for at least 20 consecutive years.
  • Employers must make necessary remuneration for other benefits under the employment contract, work rules, and laws, such as unused annual leave and other remuneration policies.

Force majeure prevents the employer from paying wages

Currently the Thai Government has not decided if the COVID-19 outbreak and their containment directives can result in a force majeure event, and it is likely to be addressed by the Thai Labor court on a case-by-case basis. Situations arising from events deemed as force majeure, resulting in the employer not being able to operate, enable the employer to withhold all wages from employees Force majeure is described under Thai law as such events/situations that a person is not able to protect against, despite taking the appropriate care that should be reasonably expected from him or her in such a situation.

As these measures and situation remains fluid and things may change at any given moment, but hopefully these guidelines will give Thai Employers some insight into their options and how the law comes into play to protect business and also their own employees during this ongoing COVID-19 developments.

Smart Search Recruitment is Bangkok's leading executive recruitment consultancy. We serve multinational and local companies, sourcing high-caliber candidates and placing them in mid and senior-level roles. For recruitment service inquiries contact us. If you are looking for a new job please drop your CV. We are committed to meet our client’s needs by delivering an exceptional level of service. We have insightful HR resources updated everyday. Please keep in touch with us via our social media.

Facebook: Smart Search Recruitment
Twitter: SmartsearchBKK
Instagram: SS.Recruitment

Read More Articles About Covid-19 Here:

Managing Employee Anxiety with COVID-19

Guide for employees affected by the Covid-19 Virus

COVID – 19 Relief Measures for Thai Companies