Severance Pay Rules in Thailand

Sudden unemployment can happen especially during Covid-19 pandemic. The economy and many companies suffer from revenue loss and declined income. Companies need to save their operating expenses such as employee salaries, utilities, tools, materials, or unnecessary costs. When the employer terminates employment without just cause, the employer must give a written notice of termination and make severance payment according to length of uninterrupted service.

The amendment version of Labour Protection Act (No. 7) B.E. 2019 specifies the rates of severance pay by working year as follows:

The exception of the employee who will not be entitled to severance pay in any of the following cases:

• Criminal offence against the employer.
• The employee willfully caused damage to the employer.
• The employee committed negligent acts which caused serious damage to the employer.
• The employee violated work rules, regulations or orders of the employer which are lawful and just, and after a written warning was given by the employer, except for in serious cases with no requirement for the employer to give warning. The written warning shall be valid for not exceeding one year from the date when the employee committed the offence.
• The employee was absent from duty without justifiable reason for three consecutive working days regardless of whether there is a holiday in between.
• The employee was sentenced to imprisonment by a final court judgment. If the imprisonment is for offences committed by negligence or a petty offense, it shall be an offense that causes damage to the employer.

However, this shall not apply to employees terminated with cause. If an employee feels a wrongful dismissal and thinks that the employer violates the employee’s compensation entitlement; the employee has the right to file a complaint to the Labour Office.

Source : www.lb.mol.go.th