Employers now required to pay compensation to retiring staff

[webfact]

Employers now required to pay compensation to retiring staff
By THE NATION

 

 

BANGKOK: -- THE CABINET yesterday approved an amendment to the Labour Protection Act, which requires employers to provide compensation to retiring workers, assistant minister to the Prime Minister’s Office Kobsak Phutrakul said.

 

In a move to deal with Thailand’s ageing society, the draft sets retirement age at 60 and deems it as job termination, therefore requiring that the retiree be compensated, Kobsak said. This was in response to many retirees suing their companies for compensation, he added. 

 

Full story: http://www.nationmultimedia.com/news/national/30303439

 

-- © Copyright The Nation 2017-01-05

[trogers]

Is this why signs on posts vacant are only for those 35 and younger?

[ezzra]

And what about the millions of retirees that are out there living on peanuts

the government give and some get nothing at all and have to fend for them

selves and be a burden on their children......

[DavisH]

Aren't private companies obligated to set up a provident fund for this reason? 

[kartman]

Here's your 6 month work contract renewable every 6 months until you reach the grand age of 59 years 6 months

[northernboy]

Sure, like the companies can suddenly afford to provide pensions, when many companies are barely keeping their doors open in the present economic times.

A burden, on their children, it is called family responsibility  Most parents took care of them when they were young, now it is their time to step up and look after their parent's needs. Is it the responsibility of the employer to look after staff to the grave when their spoilt children will not?  

[whatproblem]

Just like the minimum wage ,most employers will ignore it

[tracker1]

What about all the foreign workers ?

[JoePai]

49 minutes ago, tracker1 said:

What about all the foreign workers ?

 

Under Thai law, all are equal

[jvs]

And just how many factories have people working who are approaching retirement age?

They are let go when they can not keep up with the speed anymore,around age 40 i would say.

[Pib]

I bet there is a lot of fine print in the amendment like the person has be classified a full time employee working at least X hours per month, some employers exempted like it only applies to companies with X amount or more employees, etc...etc...etc.   I know the article says more groups are covered, but I'm sure a lot of groups are still left out. But hey, it sure sounds like an improvement which is a good thing.

 

And why are Thais so hung-up on age 60 being the age a person should retire?   With all the medical improvements, improvements in quality of life, etc.....even in Thailand....over the last generator or two...60 years of age is probably no longer valid as the age the average Thai may not be able to put in a good days work.

 

Maybe it's just more of a custom versus a need to due to physical/mental degradation....maybe it's a custom that when the kids should start fully supporting mom and dad....if the retiree has any kids or kids who are well off enough or willing to support the parents.  Heck, the parents may still be supporting the adult children.  

 

Plus, with the weak old age social security safety net for the great majority of Thais like an adequate govt pension, most Thais can't afford to retire at 60.

[GarryP]

1 minute ago, Pib said:

I bet there is a lot of fine print in the amendment like the person has be classified a full time employee working at least X hours per month, some employers exempted like it only applies to companies with X amount or more employees, etc...etc...etc.   I know the article says more groups are covered, but I'm sure a lot of groups are still left out. But hey, it sure sounds like an improvement which is a good thing.

 

And why are Thais so hung-up on age 60 being the age a person should retire?   With all the medical improvements, improvements in quality of life, etc.....even in Thailand....over the last generator or two...60 years of age is probably no longer valid as the age the average Thai may not be able to put in a good days work.

 

Maybe it's just more of a custom versus a need to due to physical/mental degradation....maybe it's a custom that when the kids should start fully supporting mom and dad....if the retiree has any kids or kids who are well off enough or willing to support the parents.  Heck, the parents may still be supporting the adult children.  

 

Plus, with the weak old age social security safety net for the great majority of Thais like an adequate govt pension, most Thais can't afford to retire at 60.

While the government retirement age is 60, many companies stuck with 55. It has only been in the past couple of years that a large number of private companies increased the retirement age to 60.  

 

I actually understood that the payment of severance upon retirement was already mandatory. Or perhaps it was just the larger companies which seemed to be paying it.   

[zaphod reborn]

3 hours ago, DavisH said:

Aren't private companies obligated to set up a provident fund for this reason? 

 

Only about 55% of private companies in Thailand have opted to offer a provident fund.  It is not mandatory.  Also, separation pay is quite different than a provident fund benefit.  The separation pay acts as additional unemployment compensation (apart from what can be obtained through social security) paid totally by the employer.  The provident fund is 50-50 funded by the employee and employer as a private pension system, similar to a 401k plan in the US.

 

1 hour ago, tracker1 said:

What about all the foreign workers ?

 

Foreign workers are also entitled to separation pay upon being dismissed for reaching retirement age.

 

34 minutes ago, GarryP said:

While the government retirement age is 60, many companies stuck with 55. It has only been in the past couple of years that a large number of private companies increased the retirement age to 60.  

 

I actually understood that the payment of severance upon retirement was already mandatory. Or perhaps it was just the larger companies which seemed to be paying it.   

 

You are correct that payment of separation pay upon being dismissed for reaching retirement age was already mandatory, as it has been so held by the Thai Supreme Court.  Adding it to the Labor Protection Act was probably intended to get more compliance out of employers, whose HR's are too lazy or don't care to keep abreast of the latest legal requirements in their labor policies.

[elgordo38]

5 hours ago, DavisH said:

Aren't private companies obligated to set up a provident fund for this reason? 

The only providence they are interested are their profits. It would be interesting to know what the percentage of companies here that offer a retirement plan. They are becoming rarer and rarer in the west. Workers are becoming like accessories in life. I just threw out an old pair of shoes that served me faithfully. 

[CanInBKK]

3 hours ago, GarryP said:

 

I actually understood that the payment of severance upon retirement was already mandatory. Or perhaps it was just the larger companies which seemed to be paying it.   

 

Yes, so did I. In fact the international accounting standard TFRS19 came into effect in Thailand a few years ago which made all public companies take a one time adjustment to their books (the rule states that the 10 months to be paid out at age 60 has to be gradually accrued from hiring date - a process not previously done so a one time cost was incurred)

 

Not how this amendment is even meaningful if the law already exists?

[seancbk]

6 hours ago, DavisH said:

Aren't private companies obligated to set up a provident fund for this reason? 

 

 

Not sure, but I plan to set one up for my staff.

 

 

[NCC1701A]

good way to slow down the economy and cause unemployment.

 

 

 

 

[elgordo38]

12 hours ago, seancbk said:

 

 

Not sure, but I plan to set one up for my staff.

 

 

Good stuff. The smaller the company the more generous they seem to be. Add shareholders and generosity goes out the window. 

[Don Mega]

19 hours ago, kartman said:

Here's your 6 month work contract renewable every 6 months until you reach the grand age of 59 years 6 months

 

I believe after a certain amount of back to back contracts you are considered a fulltime employee in the eyes of the labour dept.

[John1012]

20 hours ago, JoePai said:

 

Under Thai law, all are equal

B*ll*cks