Choice of Relocation to another country or move business entity, how it effects severance

[Millian]

The company I work for have two different business entities in Thailand, as well as businesses in other countries.  They will be relocating us to another country, and it seems the choice could be either accept the relocation offer, or they will try and find a suitable role in the other business entity here in Thailand.
 

Now if I look in my contract, it's in line with Thai Labour law and states to the effect:
 

If the company relocates affecting the course of living of the employees ............  if the employee refuses to work at the new location, such employee shall have the right to terminate employment by informing within 30 days from the date of receiving the relocation notice. In this case the Employee will also be entitled to receive special severance pay at the rate of not less than that stated in clause 2.1......

That would be clear-cut if the offer was simply relocation, I can refuse and I would be entitled to severance pay.
 

However, as it seems they may also offer to find a role in their other business entity it's not clear if the employee is still entitled to severance.  As the other business entity is also in Bangkok, it's not really affecting the course of living for the employee, but it's a different business entity to the contract I signed.
 

So I'm wondering if anyone has any idea, can a company just transfer you to another business entity rather than paying severance?
 

A lawyer would be the best person to ask, but let's see if anyone has had a similar experience in the first instance. 

[blackcab]

"...can a company just transfer you to another business entity rather than paying severance?"

 

No. Your contract is with one company. If that company chooses not to employ you, then they must pay severance. This is partly because you will get no continuity of employment rights, ie. Your total time served will start again from zero at the new company, which is a massive drawback for the employee.

 

If it was as simple as you said, all an employer would have to do to get out of paying severance is transfer the staff, start their employment served at zero, then dismiss them within the first four months without any severance pay.

 

As you can imagine, if it was like that then a few companies might take advantage. Which is why it's not like that.

[Millian]

On 8/28/2018 at 5:38 PM, blackcab said:

 

If it was as simple as you said, all an employer would have to do to get out of paying severance is transfer the staff, start their employment served at zero, then dismiss them within the first four months without any severance pay.

 

 

 

Well, you can transfer a company, and keep the same employment history, and salary etc.

In fact they did that with us before, as we were originally working under the other entity, then they created a 2nd one a few years ago for their international HQ.  Our employment was all transferred. 


I found this:

https://gettingthedealthrough.com/area/18/jurisdiction/60/labour-employment-thailand/
 

35.Is there any legislation to protect employees in the event of a business transfer?

Typically, the employment issue would appear in connection with the amalgamation and asset acquisition rather than for share acquisition. The target company is still the employer and is continuously engaging in its business. It only results in the change of the shareholding structure of the target company without generating any impact on the company’s employment.
 

In principle, asset acquisition does not affect the employment relationship between the transferor and its employees because the transferor remains the employer regardless of whether or not it will continue its business operation. In case the transferee intends to hire any employee of the transferor, the transferor’s employees will need to be transferred to the transferee. The employees must consent to the transfer of their employments, and they must be entitled to the same rights and benefits they previously enjoyed when working with the transferor. Otherwise, their employment will be deemed terminated and such terminated employees will be entitled to statutory severance pay.

 

 

Which sounds like if I don't consent, I'm due severance

 

However, I also found this:

http://www.nationmultimedia.com/detail/Economy/30332177

 

Based on the ruling in 2017 case, we may conclude that, in the case of amalgamation, employees shall be automatically transferred to a new entity while a new entity shall be obliged to provide rights and benefits to them no less than what they previously received.  No employee’s consent is required and if they refuse to work for a new entity, they would be considered as resigning and no termination payment would be required.

 

 

 

[Monomial]

I think much depends on the structure of what is happening. If the company's Thai operations are being taken over by a different Thai entity, and the company will be continuing as a going concern, then realistically you can be transferred to the new entity and your employment contracts will also be transferred. They do not require you to consent when the only change is an administrative detail.

 

If they are asking you to accept a completely new position however, in a completely new entity because they are moving operations to a new jurisdiction, that is not an amalgamation or asset acquisition.

 

In any case, I would think any arbiter on this is going to look at the intent of the company in placing you in a new position. If the company's intent is legitimate in that they are honestly merging two entities and nothing about your job or responsibility will materially change, then I don't think they need your consent. On the other hand, if they are simply trying to move you in order to avoid paying the statutory severance, then you are going to need to consent to that.

 

Suggest you go consult with the labor department about your rights before you sign anything or accept any offer in compromise.