Labor disputes can arise on a variety of issues including changes in terms and conditions of employment, overtime payments, relocation of workplaces and severance pay. These can be complex if the employees are migrant workers.
Workers’ access to complaint mechanisms depends on a number of factors including local work practices, the availability and practice of local NGOs and CSOs, and the level of awareness among workers themselves.
Employment Contracts
An employment contract is a written agreement between an employer and employee that defines the terms of their relationship. It is based on the freedom of contract principle and as long as it does not violate public order or morality, it will be considered valid. It can be in either written or oral form, although it is advisable to put it in writing. It can be for a fixed period of time or indefinite.
It is important for businesses to understand the different types of contracts in Thailand as they have significant implications on the company’s legal liability. This includes the requirements for overtime compensation, maternity leave, severance pay and other aspects of the contract.
It is also vital that companies correctly classify their employees as full-time or part-time and avoid misclassification which could lead to legal issues in the future. This also helps to ensure that employees are receiving the correct benefits such as social security contributions.
Termination of Employment
In Thailand, employment law is complex and can be difficult to navigate. It is important to always obtain specialist advice about specific circumstances, especially when it comes to the termination of employees.
At-will employment does not exist in Thailand, and an employer can only terminate an employee with a cause (as defined by law) or with the consent of the Labor Court. In both cases, the employee must receive at least a month’s advance notice and mandatory severance pay, depending on length of service.
A terminated employee may file a claim of unfair dismissal against the employer at the Labour Court, if they can provide proof that one or more of their rights were violated. If the court finds the termination unfair, it can order the employer to reinstate the employee or compensate them based on the last salary, working period, hardship from the dismissal and other factors. Employers must also cancel the employee’s work permit and business visa on the date of dismissal to avoid overstay penalties.
Severance Pay
If an employer terminates a worker without “just cause”, the employee can file a complaint with the Labor Court to obtain statutory payments such as current month salary, payment in lieu of notice and severance pay. The purpose of these statutory payments is to preserve employees’ rights and maintain a fair working environment.
In the event of a dispute, Department of Labour Protection and Welfare officials may act as mediators to help resolve the matter. However, if they are unable to settle the issue, the case will be decided by the Labour Court which are specialised courts with exclusive authority to adjudicate on labour disputes in Thailand. It is therefore essential for employers to seek advice from experts in labour law before deciding on their course of action. The legal team at Juslaws & Consult can provide you with guidance and insight into employment contracts and termination of workers in accordance to Thai labor laws.
Complaints to the Labour Court
The Labour Court is separate from regular civil courts, and judges cases related to employment issues. The Labor Protection and Welfare Act of 1998 and various laws create and govern this body.
Labor courts have broad discretion in determining whether terminations are unfair on a case-by-case basis, and they can award monetary compensation to employees who feel they were wrongfully terminated (on top of the statutory severance pay). Workers may also file criminal charges in cases where fraud is involved.
However, it can be difficult for labour inspectors to verify that complaint mechanisms are legitimate and accessible to migrant workers. Moreover, the expense and length of time to litigate a complaint in court can be cost-prohibitive for many workers, especially those who are undocumented migrants. Consequently, some employers do not implement company-wide grievance mechanisms and instead rely on local Damrongtham centers at the district and provincial levels and the MOI hotline # 1567. Often, these complaint channels are understaffed and inefficient.
