Compensation Upon Firing For Farang?

[A_Traveller]

FWIW I've noted that salary packages here are just that, a salary, then emoluments, such as travel/accommodation/aardvark training allowances. This benefits the company since much {but not all} of the corporate personnel taxation is derived from salary only, and to a greater or lesser degree 'expenses' can be claimed back. However, it would not surprise me to learn that only the salary itself would be deemed payable under these circumstances, though at the court an argument could be made for payment of the associated elements, if it could be shown that such separation was, in effect a 'tax dodge'*, though, logically excepting performance related bonuses.

*Might also benefit pre court discussions.

This level of detail really does fall into the remit of a Thai lawyer specialising in labour law and dispute resolution however.

Regards

[adjan jb]

Labour Protection Act of 1998

Section 4. This Act shall not apply to

(1) The central government administration, provincial government administration and local government administration.

(2) State enterprises under the law governing state enterprise labour relations.

Candid question: does a gvt university fall into one of these two categories ?

[happyfeet]

After working for an international school in Bangkok for six years I was told that I would not be offered a new contract. This was about 18 months ago what should I do now to claim the severance pay that is owed to me?

[HJK]

Another point worth mentioning. Some employers will pay a minimum salary to expat employees which they declare to the tax dept. to avoid paying high amounts of tax and pay the remainder in cash to the employee.

If you are terminated you are only entitled to severance pay based on the min amount, despite the fact that your contracted salary may be twice the declared salary. Then if you try to take the employee to court, the revenue dept. will hit you for unpaid taxes if you win the case.

do you know this to be a fact? I am in a similar position and I am going to court but my lawyer has not given any warnings about possible back taxes.

[HJK]

Another point worth mentioning. Some employers will pay a minimum salary to expat employees which they declare to the tax dept. to avoid paying high amounts of tax and pay the remainder in cash to the employee.

If you are terminated you are only entitled to severance pay based on the min amount, despite the fact that your contracted salary may be twice the declared salary. Then if you try to take the employee to court, the revenue dept. will hit you for unpaid taxes if you win the case.

do you know this to be a fact? I am in a similar position and I am going to court but my lawyer has not given any warnings about possible back taxes.

I should also add I was recruited via my companies Singapore office to specifically work on projects based in Thailand even though there was a Thailand branch of this company. I never actually worked in Singapore. For my first year I (and others in the company)worked with no work permit even though we pestered our HR dept and were given lots of grief getting non immigrant b visa renewals by thai embassy staff. When they eventually provided work permits, approximately one third of my salary package was paid in Thai baht and taxed and the remainder paid offshore tax free. I worked for 18 months with a work permit paying tax with the Thailand branch of my company listed as my employer on the permit and on my tax documents.

I was made redundant based on Singapore law which only required one months notice to be given and no severance pay until employed for 3 years. I complained via email to the company that under Thai law I was entitled to severance and they then sent me an additional letter telling me to get Lost basically and they weren't going to pay me anything.

I took this all to a lawyer who now says I have a strong case for unjust dismissal and has promised the earth in damages. however he seems to be avoiding the questions I have put to him regarding tax. I will also say that this particular lawyer came highly recommended by a friend who had used him in the past.

I have since been re employed in Thailand albeit in a lower paid job but I would leave the country and the job if it meant I could avoid back taxes. I might also add that my new employer is a partner company of my old company and I am now working on the exact same project that I was made redundant from, doing the same job, more or less but for less money and working alongside my old workmates, my lawyer is super confident of winning an unjust dismissal case but that could just be salesman talk to obtain the non refundable retainer.

Any advice anyone? My biggest fear is winning a dismissal case only to have all the settlement disappear to back taxes which could end up being more than any compensation I might win. I doubt whether my lawyer cares as he will take a percentage of the gross settlement anyway so he gets his money but gets nothing if I withdraw my complaint (except for retainer I have already paid).

[geuda]

Very interesting thread which gives me some thoughts. I wasn't aware of the law like many expats and was working for a private school on a one year contract base. I have been working there for three years. When they decided not to renew my contract I didn't claim any severance. Is it still time to do so?

Thanks a lot.

[twknott]

You make great points in your post but I must give you the real deal. I just left the court and guess what? If your school is registered as a private school they are NOT bound by the Thai Labor Protection Act. This is only applicable to the Thai and Foreign Teachers and Principals of the private school. The janitor is covered, the cooks are covered, the secretaries are covered but not the teachers. You are only bound by the contract you sign. I am so dumbfounded and shocked that the Thai government would allow such a law that hurt even its own citizens. In essence, a private school can and does exactly what it wants and not one person can do anything about it. I lost 7 months compensation due to this law but an illegal Burmese floor sweeper would get his. Don't believe me? Up to you........check it out.

[peterinth]

Hi

I was quite happy until I read the last reply.

I have worked for an international school for 11 years on two year contracts. My children have only ever been to this school.

Now I am told my contract will not be renewed and free education for my children will cease at my contract's end.

New information management software is being introduced and my job as manager is to be taken over by someone else, who will be trained specially.

Even if this is redundancy, which I don't think it is, I believe the school should recognize my length of loyalty and continual service and provision made for my children, at least for the next few years until they complete their external exams.

I really don't want to work for the school any more if they wish to not continue employing me. I have 6 months notice, but will have to find my own family's fare to return to the UK as the school have refused to help with that.

I feel that I should have a case for a full 12 months pay for the length of service, but to be honest I feel that the school should pay for the pain they have caused me and my family and for the fact that after 11 years here I am not likely to get another job in the same field very easily.

[Issangeorge]

I am on a one year contract that expires March 31 2011. I was told at the end of February that my contract will not be renewed, but my position still exists and they are presently advertising for it. Now for the month of March I have to go to school everyday and sign in. Am I entitled to severance pay, if so I will just tell the school that in lieu of severance pay I will just take the rest of the month off. Issangeorge

[BigJohnnyBKK]

This is one of the reasons that schools like high turnover in their foreign employees- it costs them less in terms of severance later (because few employees will sue over a month's severance when the school throws them away).

"Steven"

Note that teachers at private schools are not protected by the severance pay - there is a specific Dept of Labor ruling exempting them, including the head. Not sure about severance. In theory there is an equivalent compensation fund/scheme administered through the Education Ministry, but no one I've spoken to has ever heard Non-teaching foreigners are protected even at private schools.

Note that you could in theory do this completely without a lawyer. Just go to the Labor Court, on the left side near the entrance of the parking lot is a ground-floor room full of government-paid lawyers whose job it is to help you. You will need to bring the information as to the company registration and ownership - which should have been part of the packet you had to bring overseas to get your non-immigrant B visa, or you can get it online with help from a Thai. The whole thing is set up in favor of the employee - they will serve the company the papers, at which point they should take you seriously. Every attempt should be made to settle out of court and not waste the judge's time, and note the process can take up to a year if they want to drag it out.

Best to get a lawyer, most will work on a percentage basis, but if you have the money up front you may be able to offer a flat say B10-15K, should include the stamped translations etc - it's not that much work for them otherwise.

[BigJohnnyBKK]

You make great points in your post but I must give you the real deal. I just left the court and guess what? If your school is registered as a private school they are NOT bound by the Thai Labor Protection Act. This is only applicable to the Thai and Foreign Teachers and Principals of the private school. The janitor is covered, the cooks are covered, the secretaries are covered but not the teachers. You are only bound by the contract you sign. I am so dumbfounded and shocked that the Thai government would allow such a law that hurt even its own citizens. In essence, a private school can and does exactly what it wants and not one person can do anything about it. I lost 7 months compensation due to this law but an illegal Burmese floor sweeper would get his. Don't believe me? Up to you........check it out.

You can try to get a lawyer to be the pioneer with the Education Ministry - there is supposedly a fund set up from the private schools to give equivalent compensation for teachers, but as I posted above, I believe no one's every tried it so you'd be the one hacking through the jungle rather than riding down the paved road everyone else travels.

[BigJohnnyBKK]

Very interesting thread which gives me some thoughts. I wasn't aware of the law like many expats and was working for a private school on a one year contract base. I have been working there for three years. When they decided not to renew my contract I didn't claim any severance. Is it still time to do so?

Thanks a lot.

If you were a teacher, then no - see above. If not, yes, 10 years grace to file.

[BigJohnnyBKK]

I should also add I was recruited via my companies Singapore office to specifically work on projects based in Thailand even though there was a Thailand branch of this company. I never actually worked in Singapore. For my first year I (and others in the company)worked with no work permit even though we pestered our HR dept and were given lots of grief getting non immigrant b visa renewals by thai embassy staff. When they eventually provided work permits, approximately one third of my salary package was paid in Thai baht and taxed and the remainder paid offshore tax free. I worked for 18 months with a work permit paying tax with the Thailand branch of my company listed as my employer on the permit and on my tax documents.

<snip>

Any advice anyone? My biggest fear is winning a dismissal case only to have all the settlement disappear to back taxes which could end up being more than any compensation I might win. I doubt whether my lawyer cares as he will take a percentage of the gross settlement anyway so he gets his money but gets nothing if I withdraw my complaint (except for retainer I have already paid).

The Labor Dept doesn't care about or enforce the regulations of other departments - their job is to enforce the Labor laws, and generally they fight for employee's rights against the employer. I should point out to all the Thai bashers that this is done without regard to the status and wealth of the owners, somehow they've insulated themselves from the usual corruption contingencies. Not to mention the fact that the law's severance requirements are pretty generous - the US has nothing like this at all (although if you're a free-market libertarian of course this is a negative).

Now of course it's possible that your Singaporean company (or more likely their lawyers) will use their knowledge of the fact that you cheated the Thai government of taxes as leverage against you. However this will be a practical issue of how they could actually sic tax agents on you, how it would be collected etc. Unless the severance you're owed is really a small fraction of your possible tax liability, I'd say go for it, but of course a good (new) lawyer's advice should be sought first.

[jumbo]

So what happens if you work here for let's say 6 years and the company wants to part with you.

You get your severance pay and it's a done deal.

But when does your WP and therefore your VISA end??

Do you have to leave Thailand on the day your employment is terminated and you received the severance payment?

Usually in cases like the above you would think the employer needs the workpermit to give to your successor so a 'deal' of any kind would be out of the question...

Any ideas??

[gkinbkk]

One thing I am not sure of is the tax situation of severance. In Australia, for example, it's tax-free. I'm not sure what the deal is here.

I was also wondering this.

In Singapore it is also tax free

[jumbo]

One thing I am not sure of is the tax situation of severance. In Australia, for example, it's tax-free. I'm not sure what the deal is here.

I was also wondering this.

In Singapore it is also tax free

have a look at this link

Think most expats have that covered anyway

Edited June 15, 2011 by jumbo

[stament]

Very interesting thread, kudos to all. It would be interesting if those who ha claims could have said whether they were successful or not so everyone else can understand and learn. 

 

Understand the thread is very old now but it's still active, wonder if all the members are....

[couchpotato]

3 minutes ago, stament said:

Very interesting thread, kudos to all. It would be interesting if those who ha claims could have said whether they were successful or not so everyone else can understand and learn. 

 

Understand the thread is very old now but it's still active, wonder if all the members are....

Weird post after 10 years--sure you are still active??

[stament]

8 minutes ago, couchpotato said:

Weird post after 10 years--sure you are still active??

I hope so unless I'm a robot or AI of some sort or my account had been hacked........

 

Not sure why weird?  I simply searched the topic read it and found it very interesting but what was missing was the results of posters claims......  Hence my question.  What's weird for some is normal for others i guess like eating insects in Thailand...  Each to their own I say.