Advance Blog

January 27, 2020
Coporate Sponsor social media profile pic 2020-04

A Look Back at Thai Labour Law in 2019

In this article, Tilleke & Gibbins’ labour and employment lawyers discuss three of the most common issues that our clients have asked us about over the past year, including some of the most significant recent legal developments and applications that employers in Thailand have been facing.

Thailand’s Personal Data Protection Act

For many employers, the biggest legal shakeup of the year was the passage of the Personal Data Protection Act (PDPA). The law was published in the Government Gazette on May 27, 2019, kicking-off a one-year grace period for keepers of other people’s personal data (including that of employees) to comply with the regulations.

The PDPA, which is largely based on the European Union’s General Data Protection Regulation, defines personal data as information that directly or indirectly enables the identification of a living person. It also establishes two roles: the data controller (the one with power to decide to collect, use, or disclose the data) and the data processor (the one who collects, uses, or discloses the data on behalf of the data controller).

In general, consent is needed whenever personal data is collected or used (other than a few exceptions for certain circumstances, purposes, or organizations). A request for consent must also state the purposes of the collection, use, or disclosure. When the data is given to comply with the law or fulfil a contract, the request should state the consequences of withholding the data, the period of retention, and to whom the data may be disclosed, including information on the data controller and contact address, and the rights of the data subject.

For employers, then, separate consent must be obtained from employees if the employment agreement does not already fulfil the consent requirements of the PDPA.

Companies that transfer employees’ personal data overseas—for example, within a multinational corporation or a group of companies—are only exempt from the law’s requirements on international data transfer if the company’s internal policy on sharing personal data covers this type of transfer and has been certified by the Office of the Data Protection Committee. Otherwise, international transfers are only allowed if the destination country has appropriate protections (a phrase not yet defined in law), or if specific consent to do so is obtained.

Non-compliance with the PDPA could lead to severe criminal, civil, and administrative liabilities. These can variously mean hefty fines, damages (both actual and punitive), and even imprisonment. These liabilities apply to employers even if they outsource their human resources work. That is, the employer is still considered the data controller.

One way employers are preparing for the law’s implementation is by reviewing policies, contracts, application forms, and work rules to check compliance; another is by identifying and only handling categories of personal data that the company must collect, use, or disclose. Some employers also provide personal data protection training for employees who regularly handle personal data.

Thai Labour Law on Automation Replacing Workers

Modernization of business processes is a constant consideration for any business, which inevitably raises questions about the impact of machinery or new technology on the workforce. Thailand’s Labour Protection Act provides clear instruction, with section 121 specifically governing the reduction of employee numbers due to the adoption, utilization, or change in machinery or technology, and imposing the following minimum obligations on an employer in that situation:

  1. Give notice of termination to the affected employees at least 60 days in advance. If the employer fails to meet these requirements, the employer must give special severance pay in lieu of notice equivalent to 60 days’ wages at the employees’ last wage rate.
  2. Notify labour inspection officials of the termination date, the reasons for termination, and the names of all the affected employees at least 60 days in advance. Failure to do so can incur penalties against any directors or others authorized to act on behalf of the employer in relation to the particular termination case—which may include human resources personnel.
  3. Pay special severance equivalent to 30–400 days’ salary, depending on the length of employment.
  4. Pay additional special severance. Terminated employees who have worked for the employer for more than six consecutive years must be given additional special severance pay (no less than 15 days’ wages) for each complete year of work beyond the sixth year.

Regardless of these payments, an employer who terminates employees without sufficient and justifiable reason and evidence may still face claims in court for unfair termination. It is therefore essential that employers operate fairly and prudently if they decide to eliminate an employee’s role due to automation or technology. They should also be prepared to prove to the court (1) why the restructuring is required, (2) why the new technology eliminates the employee’s role, and (3) how the employer first attempted to find another position for the employee within the organization before deciding to terminate employment.

Amendment of Workplace Relocation Rules

In May 2019, amendments to Thailand’s Labour Protection Act broadened the scope of the workplace relocation provisions to cover an employer’s other existing work locations, such as branches. Naturally, many employers wanted to know more about how this affected them.

The updated law also lays out how an employer must inform employees about a relocation, with specific rules about the format, content, posting method, and timing of the notification, which must be made at least 30 days before relocation. If the employer fails to do so, employees are entitled to special severance pay in lieu of advance notice of at least 30 days’ wages at the employee’s last rate.

An employee who does not want to relocate, due to significant impact on the employee or his or her family, may notify the employer that he or she will not relocate within 30 days of the employer’s notification (or of the relocation date if the employer failed to notify). In the required notification was not given, the employer must make special severance payments equivalent to 30–400 days’ wages, depending on the employee’s length of service. An employer who disagrees with an employee’s reasons for refusing to relocate can lodge a complaint with the Labour Welfare Committee.

The law does not provide a definitive list of circumstances that would constitute “significant impact,” but previous cases show that costs, commuting time, family life, health, housing, outside obligations, and special circumstances are all taken into consideration.

Looking Ahead

Learning about new legal developments and applications is key to both employers seeking to operate in accordance with the law and to workers who need to understand their rights. We hope that these common questions from 2019 can help you to fit one (or both) of these categories in 2020.

Pimvimol (June) Vipamaneerut, Partner at Tilleke & Gibbins
Pimvimol is a partner in Tilleke & Gibbins’ corporate and commercial group and head of the firm’s non-contentious employment practice. The Legal 500 Asia Pacific recognizes Pimvimol as a leading employment lawyer in Thailand.
Dusita Khanijou, Consultant at Tilleke & Gibbins
Dusita is a consultant in Tilleke & Gibbins’ corporate and commercial group. She assists associates and partners in providing legal services on a wide range of corporate and commercial matters, including Thai labor law.
Auradee Pantumkomon Wongsaroj at Tilleke & Gibbins
Auradee Pantumkomon Wongsaroj is an attorney-at-law in Tilleke & Gibbins’ corporate and commercial department. She specializes in due diligence for high-value commercial transactions, and advising on commercial, energy (oil and gas and renewable energy), labor, corporate, environmental, and competition law and privacy law. Prior to joining the firm, she was a senior associate at an energy industry–focused law firm in Bangkok and at a leading energy-related public company in Thailand. She is a frequent ad-hoc lecturer on international business law and transactions and Thai labor law issues, and regularly presents at local and overseas forums on labor and, employment, and privacy and personal data protection matters.

Thailand’s Personal Data Protection Act B.E. 2562 (2019) (“PDPA”)

As the Personal Data Protection Act (PDPA) also applies to personal data collected prior to the PDPA’s entry into force, please be informed that AustCham Thailand will automatically keep your contact details including email address, name and last name, and company details, on our mailing list.

Your data was received by AustCham Thailand as a result from you either registering or attending an event, contacting our office or subscribing to regular updates via the website. However, if you would like to stop receiving emails AustCham Thailand and revoke your consent for AustCham to keep and use your data to contact you for chamber events and updates, please scroll down to the end of this email and click “Unsubscribe from this list”. Your personal data will be shortly deleted once the opt-out notice request is received.

Please note that your data is kept in AustCham’s CRM system, please see here for AustCham’s Terms of Use and Privacy Policy. AustCham uses a management software system from Wild Apricot, and emails are distributed through MailChimp.