Thai Labour Laws

[Felt 35]

A Thai friend has worked for a Thai/Foreign owned company for 4 years. The company are now sold to a new Thai/Foreign owner.

The staff has to resign from the previous owners and sign a new contract with the new owners. The work the staff do, the new contracts and salary are the same with the new owners as with the previous owners.

Point is the staff loose Seniority and start as from day one even if they have done the same work for years.

Would be great if there is someone who can tell how the Labour Laws in Thailand are regarding Seniority and eventual staff compensation when the company change owner.

Thanks & Regards

[Farma]

I found this link when searching another labour matter. http://www.cityu.edu.hk/searc/WP27_02_Thailand_Labour.pdf

Another site to look through. http://bia.serverbox.net/003.html

This is quoted on the second link

Transfer of employment Where employees are transferred, whether on the sale or transfer of a business or otherwise, the new employer is obliged to accept all the rights and obligations of the former employer, in relation to the transferred employees. The employees’ existing rights against the former employer will survive.

Edited June 17, 2007 by Farma

[Farma]

As they are being asked to resign the employer is effectively avoiding the change of employment rules and therefore the employees are entitled to a severance payment by the former owner. The new owner can then re-employ as he wishes under his new contract.

[Felt 35]

Thanks Farma.

Hopefully the seniority also follows this line....

quote]The employees’existing rights against the former employer will survive.

I’m a bit surprised that the existing rights and seniority not goes automatically as long as it is a transfer of an business from one owner to another and the work and work conditions is exactly the same as under the previous owner.

However after a look at the links you provided do I have no problem to see how the new owner would be better of with clean sheets in case the needs to dismiss employees later on!

[Felt 35]

As they are being asked to resign the employer is effectively avoiding the change of employment rules and therefore the employees are entitled to a severance payment by the former owner. The new owner can then re-employ as he wishes under his new contract.

Who can decide what kind of severance payment the employees get! Do you know if in general the labour rules in cases like this is followed or will this be a bargaining between the former employer and the employee!

Thanks.

[highchol]

As they are being asked to resign the employer is effectively avoiding the change of employment rules and therefore the employees are entitled to a severance payment by the former owner. The new owner can then re-employ as he wishes under his new contract.

Who can decide what kind of severance payment the employees get! Do you know if in general the labour rules in cases like this is followed or will this be a bargaining between the former employer and the employee!

Thanks.

severance pay is set out in thai labour laws it depends on the length of service.

Long time ago since i looked at this but i think 4 years service ..would be a minimum of 3 months salary as severance.

[Irene]

A Thai friend has worked for a Thai/Foreign owned company for 4 years. The company are now sold to a new Thai/Foreign owner.

The staff has to resign from the previous owners and sign a new contract with the new owners. The work the staff do, the new contracts and salary are the same with the new owners as with the previous owners.

Point is the staff loose Seniority and start as from day one even if they have done the same work for years.

Would be great if there is someone who can tell how the Labour Laws in Thailand are regarding Seniority and eventual staff compensation when the company change owner.

Thanks & Regards

Were the resignations volunatary and not forced by the company with the new owner? If it was forced or coerced, those resignations could be invalid and the employment could be viewed as continuous. If an employee challenges the company, he or she could be sacked. Then at that stage, the employee could test the case and try claim for the full compensation. The crucial part is whether those resignations were valid. The fact of the case is important for the Labour Court to decide.

[Felt 35]

Were the resignations volunatary and not forced by the company with the new owner? If it was forced or coerced, those resignations could be invalid and the employment could be viewed as continuous. If an employee challenges the company, he or she could be sacked. Then at that stage, the employee could test the case and try claim for the full compensation. The crucial part is whether those resignations were valid. The fact of the case is important for the Labour Court to decide.

Update! After a chat with my friend today and as I understand it the former employer have had a personal meeting with each employee. So forced to resign is probably not right way to describe it, more like "talk round".

Most of the staff, which has been with the company for less than 2-3 years and who are in low paid positions and where any education not is needed, have accepted a severance payment.

They who not have accepted have all a degree, and between 5-7 years experience in their profession and 3-4 years employment with this company.

As I understand it now the arguments are about the amount of the severance payment, which has been offered and where it seems that all the staff, more or less have been offered the same severance payment regardless of how many years they have been in the company.

Which I can understand when my friend tells my as an example a cleaner with four years employment in the company not even get one months salary in severance payment.

Regards

[highchol]

Were the resignations volunatary and not forced by the company with the new owner? If it was forced or coerced, those resignations could be invalid and the employment could be viewed as continuous. If an employee challenges the company, he or she could be sacked. Then at that stage, the employee could test the case and try claim for the full compensation. The crucial part is whether those resignations were valid. The fact of the case is important for the Labour Court to decide.

Update! After a chat with my friend today and as I understand it the former employer have had a personal meeting with each employee. So forced to resign is probably not right way to describe it, more like "talk round".

Most of the staff, which has been with the company for less than 2-3 years and who are in low paid positions and where any education not is needed, have accepted a severance payment.

They who not have accepted have all a degree, and between 5-7 years experience in their profession and 3-4 years employment with this company.

As I understand it now the arguments are about the amount of the severance payment, which has been offered and where it seems that all the staff, more or less have been offered the same severance payment regardless of how many years they have been in the company.

Which I can understand when my friend tells my as an example a cleaner with four years employment in the company not even get one months salary in severance payment.

Regards

Fours years service definately entitles at least3 months payment, I forget exactly if after 4 or 5 years service it moves up to 6 months severance pay. They should seek advice, complain to the labour dept. Its free does not require a lawyer, these laws are there to protect workers. I read through them many years back and I was suprised by how good they were in afording protection. Much better than the UK which has gone backwards in this respect.

[Irene]

Were the resignations volunatary and not forced by the company with the new owner? If it was forced or coerced, those resignations could be invalid and the employment could be viewed as continuous. If an employee challenges the company, he or she could be sacked. Then at that stage, the employee could test the case and try claim for the full compensation. The crucial part is whether those resignations were valid. The fact of the case is important for the Labour Court to decide.

Update! After a chat with my friend today and as I understand it the former employer have had a personal meeting with each employee. So forced to resign is probably not right way to describe it, more like "talk round".

Most of the staff, which has been with the company for less than 2-3 years and who are in low paid positions and where any education not is needed, have accepted a severance payment.

They who not have accepted have all a degree, and between 5-7 years experience in their profession and 3-4 years employment with this company.

As I understand it now the arguments are about the amount of the severance payment, which has been offered and where it seems that all the staff, more or less have been offered the same severance payment regardless of how many years they have been in the company.

Which I can understand when my friend tells my as an example a cleaner with four years employment in the company not even get one months salary in severance payment.

Regards

The choice is either to consult the Labour Department who normally loves to help thereby annoying the current employer or discreetly see the official and find out whether it is better to keep quiet now and demand the normal compensation as though the resignation was never effective. I think the second choice is more practical.

[Felt 35]

Fours years service definately entitles at least3 months payment, I forget exactly if after 4 or 5 years service it moves up to 6 months severance pay. They should seek advice, complain to the labour dept. Its free does not require a lawyer, these laws are there to protect workers. I read through them many years back and I was suprised by how good they were in afording protection. Much better than the UK which has gone backwards in this respect.

As far as I know a few of the employees have been in touch with the Labour office on phone, but I don’t know what they recommended them to do.

[Felt 35]

The choice is either to consult the Labour Department who normally loves to help thereby annoying the current employer or discreetly see the official and find out whether it is better to keep quiet now and demand the normal compensation as though the resignation was never effective. I think the second choice is more practical.

I see your point. The problem is for them that they get only 10% of normal compensation. Or maybe its normal.

The few, which not want to accept a low severance payment, do probably know that they are doing! They easily get another job because it’s less than a hundred with their specific education in Thailand.

Thanks & Regards

[wolfmanjack]

Period of Employment Amount of Severance Pay

More than 120 days but less than 1 year 30 days wages or salary

At least 1 year but less than 3 years 90 days wages or salary

At least 3 years but less than 6 years 180 days wages or salary

At least 6 years but less than 10 years 240 days wages or salary

At least 10 years 300 days wages or salary

It is 6 months after 3 years. It would benefit the new owner by being able to reset the seniority but I think the only way they would be able to get around it is if there was a new company formed and the old company would have to pay the severance pay.

[Felt 35]

It would benefit the new owner by being able to reset the seniority but I think the only way they would be able to get around it is if there was a new company formed and the old company would have to pay the severance pay.

This is the problem, the old company do not want to pay normal severance pay after this lines....

More than 120 days but less than 1 year 30 days wages or salary

At least 1 year but less than 3 years 90 days wages or salary

At least 3 years but less than 6 years 180 days wages or salary

At least 6 years but less than 10 years 240 days wages or salary

At least 10 years 300 days wages or salary

[Felt 35]

Update!

The staff that still not have resigned voluntary have been offered between 5-8k Baht in severance payment. Which they not accept. As far as I know that amount is not even a half-month salary for the actual staff. If they not resign voluntary they have to accept another position in the company. (The old company/former owner has other businesses.)

My friend told me today that some of the above mentioned staff have been to the Labour department and got the message that they have to wait to the company change owners before they (Labour department) can do anything!

I don’t know how to "read" that message <_<

[Irene]

Update!

The staff that still not have resigned voluntary have been offered between 5-8k Baht in severance payment. Which they not accept. As far as I know that amount is not even a half-month salary for the actual staff. If they not resign voluntary they have to accept another position in the company. (The old company/former owner has other businesses.)

My friend told me today that some of the above mentioned staff have been to the Labour department and got the message that they have to wait to the company change owners before they (Labour department) can do anything!

I don't know how to "read" that message <_<

I don't understand the message either. It should be clear the employer of those employees in this case is the company who is the employer and there is no change of the employer. The change of shareholders of the company and change of the policy of business does not affect the legal relationship of the employer (the company) and the employees. So what is the point of resignation! The whole scheme was to reduce the burden of severance pay for the new shareholders. Check with the Law Society on the appropriate steps, http://www.lawyerscouncil.or.th/ They have volunteers to give free legal advice. However, initially, the enquiry should discreet since you do not want the current employer to gun on you yet.

[Felt 35]

I don't understand the message either. It should be clear the employer of those employees in this case is the company who is the employer and there is no change of the employer. The change of shareholders of the company and change of the policy of business does not affect the legal relationship of the employer (the company) and the employees. So what is the point of resignation! The whole scheme was to reduce the burden of severance pay for the new shareholders. Check with the Law Society on the appropriate steps, http://www.lawyerscouncil.or.th/ They have volunteers to give free legal advice. However, initially, the enquiry should discreet since you do not want the current employer to gun on you yet.

A Thai friend has worked for a Thai/Foreign owned company for 4 years. The company are now sold to a new Thai/Foreign owner.

As said in my first post quoted above, it is a change of employer and with that probably shareholders.

What not change is the name of the company, work and work conditions for the employees.

Thanks.

[Felt 35]

I don't understand the message either. It should be clear the employer of those employees in this case is the company who is the employer and there is no change of the employer. The change of shareholders of the company and change of the policy of business does not affect the legal relationship of the employer (the company) and the employees. So what is the point of resignation! The whole scheme was to reduce the burden of severance pay for the new shareholders. Check with the Law Society on the appropriate steps, http://www.lawyerscouncil.or.th/ They have volunteers to give free legal advice. However, initially, the enquiry should discreet since you do not want the current employer to gun on you yet.

Update. The said staff has now been in contact with concerned people through the link provided above and the Labour Department. My last information is that they now get the help they need and have the rights to get.

Thanks for the links and helpful info.

[Felt 35]

Update and the end of the above case that just have went through the labour court.

The staff got 3-½ month each in severance payment.

Thanks & Regards