Dont Wish To Renew Contract

[nonthaburial]

After working for a Thai company in a senior position for the last six years, my contract is up for renewal in July. I have had it hinted that the company wish to renew my contract again for another year.

However, I have decided not to renew. but the company does know this yet.

In my contract it states that either party can terminate at any time without reason as long as a three month warning is given.

Taking into account that by law ( ) I would be entitled to one months salary for every year worked, which of course would be a nice little farewell present, which I dont want to jeopardise. So the questions are,

If I have no intention of renewing my contract, should I give a three months notice warning ?? OR when the time to resign comes can I just inform them that I do not wish to renew and thank you for a memorable six years ??

I feel that due to circumstances I must approach this properly and legally and dont want to give the company any excuses to walk away from their legal responsibilities.

[GuestHouse]

Firstly it is always good policy to leave on the best of terms.

With that in mind my advice is give your employer's three months notice that you do not wish to renew your contract.

Secondly, you seem to be suggesting that your employer's might be giving you a one month pay per year of service severence payment - I believe you are missunderstanding the terms of that payment.

It is almost certainly:

a mininum payment if they close your contract early (ie redundancy payment) and/or a minimum notice period that can be paid in cash AND subject to you yourself not breaking the contract.

My guess is you have no such payment coming your way, and especially so if you give notice that you wish to leave of your own free will.

[CWMcMurray]

After working for a Thai company in a senior position for the last six years, my contract is up for renewal in July. I have had it hinted that the company wish to renew my contract again for another year.

However, I have decided not to renew. but the company does know this yet.

In my contract it states that either party can terminate at any time without reason as long as a three month warning is given.

Taking into account that by law ( ) I would be entitled to one months salary for every year worked, which of course would be a nice little farewell present, which I dont want to jeopardise. So the questions are,

If I have no intention of renewing my contract, should I give a three months notice warning ?? OR when the time to resign comes can I just inform them that I do not wish to renew and thank you for a memorable six years ??

I feel that due to circumstances I must approach this properly and legally and dont want to give the company any excuses to walk away from their legal responsibilities.

You may want to double check the 1 month per year worked severence package.

I may be wrong but I believe that only comes into effect if you are fired or your contract is not renewed by the company.

If you chose to resign or not renew your contract I don't believe you will qualify for any severence pay.

[Prakanong]

Guesthouse is spot on

Always best to leave on good terms - you or they might want to be together again!!

You never know when something comes up in future both ways and you can help each other out

As for 1 month salary for each year - as Gh says that when they let you go for other reasons - not at the end of a fixed contract unless stated

Best thing is to say you have 3 months either way - talk to them about it - do they want you to stay - do you want to?

For a guy in a senior position as you state I find it strange you are asking these questions - I am and I know what I would do and I know exactly where I stand - things can change of course but I have a longer outlook than 3 months

[nonthaburial]

Thanks for your replies, all noted. my major questions stemmed around the labour laws and interpretations. Hence my walking on eggs attitude.

for example, by not agreeing to a new contract, is that classified as a resignation ?? . I personally think not, which could then be suggested that I have completed all my contracts satisfactorily and upon reaching the age of 60 I wish to retire.

And it is my belief that an amount as stipulated in the labour laws may be payable. Of course I may be wrong

[GuestHouse]

Thanks for your replies, all noted. my major questions stemmed around the labour laws and interpretations. Hence my walking on eggs attitude.

for example, by not agreeing to a new contract, is that classified as a resignation ?? . I personally think not, which could then be suggested that I have completed all my contracts satisfactorily and upon reaching the age of 60 I wish to retire.

And it is my belief that an amount as stipulated in the labour laws may be payable. Of course I may be wrong

I think you are still wrong.

If YOU do not renew a contract then the terms of the contract are nolonger valid - by YOUR CHOICE.

I also suspect that the contract will be 'complete and closed' at age 60 hence I would be very surprised if you received a severance pay upon retirement.

The severance pay is almost always 'Compensation for early breaking of contract' (a protection for employees if the company need to reduce staff) not an accrude benefit that you are entitled to when YOU CHOOSE to leave.

[Prakanong]

As GH states - that would be my interpretation unless specifcally stated and an out or ordinary contract

Is it a Thai or a MNC - if its a MNC what GH states and I agree is the interprtation we give.

Its funny as a few of us agreed last night that HR are worthless C&*(% - I know one CEO who says outsource pay and benefits and sack the lot

[bendix]

Let me clarify. Severance payments CAN and DO apply when an employee on a fixed term contract does not have that contract renewed. There are plenty of other threads on this and there is extensive case law history in Thailand (including involving farang) where employers have had to pay severance money to employees for refusing to renew a fixed term contract. Under Thai law fixed term contracts (except in a few circumstances such as project work outside the employers normal business or seasonal work) is treated EXACTLY the same as permanent employment.

However, the OP is wrong to assume that he will get severance pay in this example because it is the OP himself who is effectively resigning or refusing to renew a contract. He is voluntarily leaving the employment. Severance pay is only when the employer - not the employee - terminates the employment.

If employees were eligible for severance pay just because they resigned, who would stay in a job? Think about it . .

A final point. Severance pay (where applicable) is a minimum of 6 months salary after three years employment and 9 months after 6 years employment.

[Gary A]

A farang friend of mine worked for a Thai company for nine years. He and the boss had a major falling out because of reasons that are not important regarding this subject. My friend went home and told his Thai wife that he was quitting. She immediately called a lawyer friend and got advice. That advice was to stay until the boss told him to leave. If he quit on his own, he would receive nothing. Within a couple of weeks the boss fired him and he did receive severance pay as per Thai law.

[sureena]

Let me clarify. Severance payments CAN and DO apply when an employee on a fixed term contract does not have that contract renewed. There are plenty of other threads on this and there is extensive case law history in Thailand (including involving farang) where employers have had to pay severance money to employees for refusing to renew a fixed term contract. Under Thai law fixed term contracts (except in a few circumstances such as project work outside the employers normal business or seasonal work) is treated EXACTLY the same as permanent employment.

However, the OP is wrong to assume that he will get severance pay in this example because it is the OP himself who is effectively resigning or refusing to renew a contract. He is voluntarily leaving the employment. Severance pay is only when the employer - not the employee - terminates the employment.

If employees were eligible for severance pay just because they resigned, who would stay in a job? Think about it . .

A final point. Severance pay (where applicable) is a minimum of 6 months salary after three years employment and 9 months after 6 years employment.

Kindly provide guidance in the following situation:

An employee is hired on a one year-renewal fixed term contract. However, before the end of the term, he is terminated by his employer for reasons other than his performance. In this case what will be the compensation given to him?

[quiksilva]

If less than 12 months that person would be entitled to one month's severance pay and if asked to leave immediately they would be due one month's notice as well, although the firm could insist that they work their notice period, but thats quite unlikely.

If the term of employment has been more than 12 months but less than 3 years they are entitled to 3 months pay + one months notice and the longer periods are as Bendix described.

At least that's my understanding.

[bendix]

spot on quicksilva.

Despite being a one year rolling contract, it is the total time served that is relevant, not the fact that you may have accrued, say, five years comprising five one year contracts.

If you'd worked five years on one year rolling contracts and they wanted to get rid of you, they would be obliged to pay severance for the entire five years (eg 6 mths).

[Tango7]

It could be that the OP was referring to bonus payments of one month for every year served. This might have been an incentive to stay the course of the 6 years.

If it's bonuses we're talking about, you have to check the contract, but as far as severance if you leave, forget it.

Just a thought..

[jrbkk64]

As far as I know bendi, quicksilva and others are right about the severance pay, however if company rules/thai law put the retirement age at 60 and the employee wishes to retire at the end of the calendar year in which he turns 60, the company must pay severance (retirement) pay following the same rules as normal severance pay.

[TerryLH]

"Kindly provide guidance in the following situation:

An employee is hired on a one year-renewal fixed term contract. However, before the end of the term, he is terminated by his employer for reasons other than his performance. In this case what will be the compensation given to him?"

It would depend on why you are terminated. If for 'cause', as outlined in labor law, nothing is due you.

If they give you 'ABC' as the reason for termination, they can't change it or add new reasons for the termination at a later date, such as when answering a court case.