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11 Sep 2017
The new “Labour Protection Act (No. 6) B.E. 2560 (2017)” is legally effective from the 1st September 2017. The main changes are (1) the retirement age of employees is fixed at 60, and (2) companies who employ 10 or more employees are no longer required to submit their work regulations to the Ministry of Labour. However they should publish and post these work regulations conspicuously to ensure employees know and can find the regulations.
With regards to work regulations, Section 108 states:
An employer who employs ten employees or more shall prepare their work regulations in Thai language. These must contain at least the following:
The employer should announce these regulations within fifteen days from the day the employer employs ten employees upwards, and the employer shall keep a copy of such work regulations at the place of business or at his office at all times.
With regards to the changes related to the retirement age:
Thailand’s labour law had not previously set the retirement age of employees and employers had not been required to set an official employees’ retirement age as company policy. Once an employee turns 60 they will have two choices: resign or continue working until employment is terminated. If employees choose to continue working after 60 and later decide to resign, they will not be entitled to Severance Pay from their employers.
However, this amendment establishes a fixed retirement age for all employees at 60. Once the employee turns 60 they will be entitled to Severance Pay as under the new law, retirement will be considered as a form of job termination, requiring employers to compensate retiring employees.
According to the amendment, the compensation rate would be as follows:
After retirement, should an employer desire to continue hiring a ‘retired’ employee, a new employment contract could be made in a form of a fixed term employment contract or a contract under specific projects.
A criminal penalty of not more than 6-month imprisonment or a fine of not exceeding 100,000 Baht may be applied to non-compliance employers.
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