Changes to Thai Labor Law Include Greater Severance, Maternity Leave

Woman playing with baby daughter's feet on bathroom floor, mom, mother, Asian

Changes to Thailand's Labor Protection Act (Thai), including increased statutory severance for employees with at least 20 years' service, could take effect as early as 1 Feb 2019. Key revisions include:

  • Employees with 20 years or more of service are entitled to 400 days of statutory severance, up from 300 days for employees with at least 10 years' service. In Thailand, retirement is deemed to be a termination of employment, entitling employees to a severance payment. With the law's effective date imminent, employers should make needed changes to pension arrangements immediately.
  • Maternity leave increases to 98 days, up from 90 days, and covers prenatal and postnatal leave.
  • Employers must give employees at least three days' paid personal or business leave. The duration and payment for this type of leave previously was specified in employers' workplace rules.
  • When an employment contract transfers to a new employer — for example, after an acquisition or a merger — the employee must consent to the transfer before it takes effect. Employees refusing to consent will be entitled to severance pay.
  • Employees who don’t want to transfer to another location in Thailand can choose to terminate employment and receive severance pay.
  • Sanctions have increased for employers that breach workplace rules, including wage and overtime requirements, such as vacation pay, payments during a temporary cessation of an employer's business or in place of advance notice to employees, and severance and special severance pay.

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Fiona Webster
by Fiona Webster

Principal, Mercer’s Law & Policy Group

Stephanie Rosseau
by Stephanie Rosseau

Principal, Mercer’s Law & Policy Group

Suwattana Ratanavibhas
by Suwattana Ratanavibhas

Associate, Mercer Wealth

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