The Wage Committee has announced a Notice of Minimum Wage Rates (No. 13) with a significant increase in the minimum wage, effective 1 January 2025. This change will have a major impact on businesses, particularly in the areas of Chachoengsao, Chon Buri, Phuket, Rayong, and Surat Thani Province (Ko Samui District), where the minimum wage rate has reached its highest level of THB 400 (Four Hundred Baht) per day, equivalent to THB 12,000 (Twelve Thousand Baht) per month.
It is crucial for employers employing workers on the previous minimum wage to review their payroll and ensure compliance with the updated legal requirements.
Minimum Wage For 2025
Starting in 2025, Thailand has implemented an increase in the minimum wage across different provinces as follows: please find in PDF Minimum Wage for 2025
The wage adjustments are not only intended to support workers but also to ensure a fairer and more competitive labor market. This is especially important as it impacts both Thai and foreign workers, particularly foreign employees holding work permits.
A) Impact on Thai Employees on the Payroll Receiving the Current Minimum Rate
For employers who have Thai employees currently earning the minimum wage, it is essential to review and adjust the payroll in line with the new minimum wage rates for 2025. If Thai employees’ salaries fall below the new minimum wage, businesses must adjust their pay structure to ensure compliance with the new law.
Failure to do so could lead to issues during labor inspections and compliance with the Thai Labour Protection Act.
B) Impact on Foreign Employees Holding Work Permits and Quotas
For employers who have foreign employees working in Thailand on a work permit, particularly those subject to the quota of 4 Thai employees per foreigner (which may include Thai employees in low salary positions such as drivers, maids, etc.), they must also comply with the new minimum wage rules. Under current regulations, for each foreign employee holding a work permit, the company must maintain a quota of at least 4 Thai employees on the payroll.
The key issue to be aware of is that if any of the Thai employees earning the current minimum wage fall below the new rate in 2025, the company could face significant challenges when renewing visa for foreign employees. The Immigration Department will closely monitor compliance with wage standards, including checks on the PND.1 (Payroll Withholding Tax) filing. If any Thai employee’s salary is found to be below the new minimum wage, it could result in the rejection or suspension of visa renewals.
C) What Employers Need to Do Now
To avoid any complications, businesses should take the following steps:
- Review Your Payroll: Ensure that all Thai employees on the payroll are earning at least the new minimum wage as announced for 2025. This applies to all employees, including those in the quota of 4 Thai workers per foreign employee.
- Adjust Salaries: If any employee’s salary is currently below the new minimum wage, it’s crucial to increase their pay before the law takes effect in 2025 to avoid compliance issues.
- Update Work Permits and Visas: For foreign employees holding work permits under the 4 Thai employee quota, ensure that all related Thai employees meet the new wage requirements. This will help avoid delays or issues when renewing work permits and visas.
- Consult with Legal or HR Experts: It’s advisable to consult with a legal or HR professional who can guide you through the specifics of wage adjustments, compliance, and how to handle foreign employee quotas effectively.
