Employment Contract Advice

[alphason]

Not sure where to post this but here goes...

Thai employment contract (with Thai employee/employer) signed 6 months ago, fine of 100,000B if you leave within 2 years. 1 month before contract is made is training which is paid for by company, if you pay for this as an individual it's around 18,000B. Employee wants to leave to move away, has asked for a transfer to another branch within the company but was denied re the contract. contract guaranteed by parents, neither her or parents have the money if they wanted to pay. Others have left and the rumour is they just send a letter with no further action. The fine is unreasonable in comparison to the salary, I think reasonable to ask for training fees back but nothing more.

I know its difficult without seeing the actual contract, but does anyone have any advice? Thanks.

[TAWP]

A contract is a contract.

Perhaps more people should think before they sign up...or stop trying to scam themselfs into getting education without having to pay for it until afterwards, i.e. loan without interest.

[fletchsmile]

Have heard of the equivalent of cash bonds being taken on starting. These are often in industries where employees deal with cash/money and a sort of guarantee.

Have also heard of penalties on leaving. But usually these are not more than one month salary, but occasionally if on say two month's notice.

So in most cases people could walk away and simply forfeit the bond already paid, or an upcoming salary. Haven't heard of anyone in legitimate industries where people actually pay extra on leaving. Some trafficking industries maybe. Not to say it isn't possible, but don't actually see anyway how they could enforce, particulalry if unfair

[lazeeboy]

A contract is a contract.

Perhaps more people should think before they sign up...or stop trying to scam themselfs into getting education without having to pay for it until afterwards, i.e. loan without interest.

if its in the contract ,its in the contract other wise the company has'nt a leg to stand on ,see out the 2 years and leave ,or leave now and go to court .

[Briggsy]

I have seen these style of contracts in Thailand. It was a company that sent the new staff for 6 months' training in Europe. They had to provide copies of land documents. 50% of the new staff thought the fine too heavy and did not want to tie themselves to the company for 2 years with no guarantee of a salary increase. So they left before signing the contract and did not go to Europe.

Would the company enforce the fine? I don't know, but legally I'm sure they have a right to.

[a2396]

Not sure where to post this but here goes...

Thai employment contract (with Thai employee/employer) signed 6 months ago, fine of 100,000B if you leave within 2 years. 1 month before contract is made is training which is paid for by company, if you pay for this as an individual it's around 18,000B. Employee wants to leave to move away, has asked for a transfer to another branch within the company but was denied re the contract. contract guaranteed by parents, neither her or parents have the money if they wanted to pay. Others have left and the rumour is they just send a letter with no further action. The fine is unreasonable in comparison to the salary, I think reasonable to ask for training fees back but nothing more.

I know its difficult without seeing the actual contract, but does anyone have any advice? Thanks.

I assume this is a Thai person, working for a Thai company you are talking about. What relationship is the employee in question to you? Why should you get mixed up in it?

[alphason]

Yes as stated it's a Thai person and Thai Co, no loan involved no bond paid upfront, its a legit company with a dozen or so branches within Thai, just trying to help out does not affect me, yes they have provided education but any outsider can get also this at 18,000B.

Does Thailand have something similar to the Unfair Contracts Terms Act?

Thanks for replies.

[singa-traz]

Yes as stated it's a Thai person and Thai Co, no loan involved no bond paid upfront, its a legit company with a dozen or so branches within Thai, just trying to help out does not affect me, yes they have provided education but any outsider can get also this at 18,000B.

Does Thailand have something similar to the Unfair Contracts Terms Act?

Thanks for replies.

I was always told from people involved with recruitment (but not by a lawyer), that this type of contract are not valid in Thailand, and that if taken to court the company would loose.

Unfortunately, no fact to back up this ...

[samran]

contracts which require repayment of eductional frees if the person does not repay them in time served are very common.

Thai government sends loads of people overseas to study at the best universities, and they are required to stay 2 years as a civil servant for every one year they got in free education. If they leave, they pay the government out....

[singa-traz]

contracts which require repayment of eductional frees if the person does not repay them in time served are very common.

Thai government sends loads of people overseas to study at the best universities, and they are required to stay 2 years as a civil servant for every one year they got in free education. If they leave, they pay the government out....

But is it the same for "Company Training", which might not be such formal education (as your valid example)?

A few years ago, my company was doing "Boot Camp" program (4-6 weeks training), and we discussed on how to prevent to say "bye bye" at the end.

[steveromagnino]

Yes as stated it's a Thai person and Thai Co, no loan involved no bond paid upfront, its a legit company with a dozen or so branches within Thai, just trying to help out does not affect me, yes they have provided education but any outsider can get also this at 18,000B.

Does Thailand have something similar to the Unfair Contracts Terms Act?

Thanks for replies.

The person was presented with a contract, and signed if of their own free will. Nothing unfair about the terms, perfectly normal.

If there was something contrary to THai labour law, then that would be impossible to contract out of, but this is all run of the mill stuff IMHO.

Tell the person concerned they MIGHT have a shot to appeal to the good hearts of the employer IF a parent is sick with cancer or similar...but legally for sure they have made their bed and should sleep in it.

Not sure why you or anyone else ever thinks that companies should be charities educating their employees.....

[TerryLH]

"...fine of 100,000B if you leave within 2 years."

"Nothing unfair about the terms, perfectly normal." "...this is all run of the mill stuff IMHO."

What are you basing your opinion on?

OP, have the woman contact the labor Office and see what they have to say.

[TAWP]

Experience from friends that have or are running departments and/biz here in Thailand is that unless these things are done in contract you WILL get ripped off as an employer.

One guy continiously hired people and had them trained for the positions to be able to handle two big new contracts. After 3 months every single one (6 of them) had quit and opened their own companies in the same biz. In the future I'm guessing he will add clauses like the one above to any contracts...

[researcher]

The person was presented with a contract, and signed if of their own free will. Nothing unfair about the terms, perfectly normal.

If there was something contrary to THai labour law, then that would be impossible to contract out of, but this is all run of the mill stuff IMHO.

Tell the person concerned they MIGHT have a shot to appeal to the good hearts of the employer IF a parent is sick with cancer or similar...but legally for sure they have made their bed and should sleep in it.

Not sure why you or anyone else ever thinks that companies should be charities educating their employees.....

In most countries all contracts have to be reasonable to be enforced. If it's not reasonable, then a court can just throw it out.

[TAWP]

No, only if the contract goes against the law in any way, then it will be void.

'Unfair' contracts exists all the time, see the music biz.

[singa-traz]

No, only if the contract goes against the law in any way, then it will be void.

'Unfair' contracts exists all the time, see the music biz.

Not sure of that. See below.

In the majority of the cases, it is also against the law to require a security deposit from your employee (authorized under certain situation).

http://www.darroll-law.com/derebus.doc

In Thailand the Unfair Contract Terms Act has considerably reduced the unconscionable business practice whereby some pre-prepare 'small print' contracts with clauses wholly in their favour. They then push these under the noses of their unsuspecting customers, normally in weaker bargaining positions.

The Thai Act prohibits this abuse of the freedom of contract and the related caveat subscriptor doctrine. A person with greater economic bargaining power may not take advantage of others less empowered. It establishes guidelines for the court to identify unfair contract terms and empowers courts to set them aside if unreasonable.

Contracts within the Act's scope are, for example

o the supply of goods or services between a 'business or profession' and a 'consumer';

o pre-written business contracts (eg insurance policies and hire-purchase contracts);

o restrictive employment contracts; and

o where liability for wrongful acts, breach of contract or defective goods or services is excluded or limited.

The court decides whether the term is excessively or unduly unfair. If so, it may be declared unenforceable - or enforceable to the extent considered reasonable. In assessing whether a contractual term causes one party to have an unreasonable advantage, the court applies the 'fairness test'. It takes into account the circumstances including good faith, relative bargaining strengths, other alternatives, the actual gain or loss of the contractual parties, etc.

[TAWP]

As I said, "unless the contract is against the law". If a deposit is against the law, then the contract are defining something that is against the law, as per my previous posting, and are therefor void.

It's not void for being 'unfair' however.

[singa-traz]

As I said, "unless the contract is against the law". If a deposit is against the law, then the contract are defining something that is against the law, as per my previous posting, and are therefor void.

It's not void for being 'unfair' however.

Did you read this part as well? (the Bold Section)

The Thai Act prohibits this abuse of the freedom of contract and the related caveat subscriptor doctrine. A person with greater economic bargaining power may not take advantage of others less empowered. It establishes guidelines for the court to identify unfair contract terms and empowers courts to set them aside if unreasonable.

[TAWP]

It's the briefs summery, but you are welcome to point out in the actual Thai Act how it identifies this. Would be interesting for a lot of people.

(Laws or Acts with subjective entries are even better, but perhaps I shouldn't be surprised.)

[LinkPopularity]

a contract is not always a contract

if there's anything in it NOT according the law then the contract has no value

the law is still above a contract

so, check the law !

[singa-traz]

Link to article about: "Unfair Contract Terms Act, B.E. (2540) 1997"

http://www.marut.th.com/pr/mshow_index.php3?id=15

[TerryLH]

"...if there's anything in it NOT according the law then the contract has no value"

The contract could still have value. The only part not 'of value' would be the part in violation of the law.

The rest of the contract would still be considered valid.

[alphason]

Thanks everyone!

I think we may end up showing it to a lawyer and see what happens, I'm pretty interested to know now. If we get a result I'll let you know.