Terms of employment, working time and overtime payment and relocation of workplace issues are some of the reasons for labour disputes in Thailand. Employers need to understand and follow the rules and regulations set forth by law in order to avoid a legal dispute with their employees.
At Juslaws & Consult, we can advise you about your legal rights regarding labor disputes in Thailand. Our team can settle the matter through mediation, arbitration or even litigation.
Employment Contracts
Employment contracts are a critical aspect of the employer-employee relationship. They establish working conditions, wage rates, and work days and hours. They can be verbal or written, but written employment contracts are generally favored. The terms of an employment contract should comply with the Labor Protection Act, which is the primary safeguard for worker rights in Thailand.
In addition, the law requires employers to offer statutory benefits, such as 13 holidays per year, medical insurance, and overtime pay on a regular basis. Employers may also be subject to fines or penalties for misclassifying workers as independent contractors rather than employees, which is why HR leaders should seek professional guidance when drafting contracts.
Employees who have been unfairly dismissed can file a claim with the Department of Labour Protection and Welfare, or they can bring a case to the labor court, which is a specialized tribunal that hears disputes about employment law issues. If a tribunal rules that an employee’s termination was unwarranted, the employer can be forced to reinstate the employee (at their former salary) and compensate them for any unused annual leave and overtime pay.
Mediation
A mediator is a neutral, impartial person who helps the disputing parties reach an agreement in their case. A mediator may also help them find ways to avoid a lawsuit. Litigation is expensive and can take a long time to resolve a dispute. Alternative dispute resolution mechanisms like conciliation and mediation offer a faster, less costly route to a resolution.
Conciliation and mediation can occur outside of court proceedings or as part of a court-supervised process. It is usually voluntary, but a judge can suggest it to disputing parties in certain cases.
Watson Farley & Williams (Thailand) Limited has an experienced team of arbitration and litigation lawyers that regularly advises on disputes in Thailand. Practice leader Waree Shinsirikul has experience with bankruptcy and rehabilitation proceedings, commercial litigation, and contentious international trade matters. She is joined by Kay Kian Tan, who advises on power and energy disputes, transport mandates and insurance claims. The team is also well versed in defending clients from arbitration claims.
Arbitration
A variety of issues can give rise to disputes between employers and employees. These include severance pay, relocation of workplace, overtime payment, and other terms and conditions of employment. In many cases, these matters may involve foreign labour laws and local cultural considerations, adding further complexities to the proceedings.
Arbitration is an alternative dispute resolution process that allows disputing parties to meet with a neutral third party (the mediator) and work through the issues in order to find a mutually acceptable solution. Arbitration is a more formal ADR process than mediation and vests the responsibility of the outcome in the arbitrator appointed to hear the case and render a decision.
Upon being appointed to arbitrate, an arbitrator must disclose any circumstances that might lead the parties to have justifiable doubts about their impartiality or independence. In addition, a court can intervene in an arbitration and set aside or enforce an award under certain circumstances.
Trial
When mediation has failed, the parties may choose to go to trial. Trials are held in a court of first instance and typically last several days until all the evidence is presented. The courts will weigh a variety of factors to reach a verdict including the mutual contractual obligations, work environment, cost of living, wages, and benefits in kind, financial and economic circumstances of the employee and employer, and social conditions, among others.
The courts will usually award compensation to the employees based on the evidence presented. They may also decide to award moral damages if they deem the situation warrants it.
Keeping an eye on your employee’s rights and avoiding issues that might result in disputes will increase overall morale, boost productivity, and improve employee retention rates. Juslaws & Consult can help you make sure that your organization follows the appropriate rules regarding termination and wrongful dismissal in accordance with Thailand’s Labor Protection Act.