Key Takeaways
- Thailand’s dismissal framework operates on three levels: the Labour Protection Act, the Civil and Commercial Code, and the Labour Relations Act
- Labour courts are free for workers to use, and dismissal cases are among the most common disputes filed
- This 5-part series covers everything from ordinary dismissal to disciplinary termination, redundancy, and preventive legal practice
Introduction: Why Japanese Companies in Thailand Need to Understand Dismissal Law
One of the most frequent questions received from HR managers and executives at Japanese companies operating in Thailand is: “We need to let an employee go — what do we do?” Applying Japanese HR practices to Thailand without modification can lead to unexpected high severance payments or losses at the Labour Court.
This 5-part series, “Thai Dismissal Law in Practice,” systematically covers Thailand’s dismissal system and provides practical guidance for the situations that Japanese companies in Thailand commonly face. Part 1 covers the overall legal framework and the fundamental differences from Japan.
The Three Pillars of Thai Dismissal Law
Thailand’s dismissal regulations are shaped by three interrelated laws.
1. Labour Protection Act B.E. 2541 (1998), amended B.E. 2562 (2019)
This is the core statute. Key provisions directly relevant to dismissal include Section 118 (mandatory severance pay), Section 119 (six grounds for dismissal without severance), and Section 121 (advance notice requirements for redundancy). The 2019 amendment significantly increased the maximum severance pay ceiling.
2. Civil and Commercial Code
Employment contracts are also governed by the Civil and Commercial Code as contracts of employment. Claims for damages arising from wrongful dismissal may be grounded in the Code’s provisions on tort and breach of contract.
3. Labour Relations Act B.E. 2518 (1975)
This law governs trade unions, collective bargaining, and industrial disputes. Dismissal of union officials requires approval from the Labour Court. Where a union is organized, additional procedural steps may be required.
flowchart TD
A[Considering Dismissal] --> B{Type of Dismissal}
B --> C[Ordinary Dismissal]
B --> D[Disciplinary Dismissal]
B --> E[Redundancy]
C --> F[LPA Sec. 118<br/>Severance + Notice]
D --> G[LPA Sec. 119<br/>6 Grounds]
E --> H[LPA Sec. 121<br/>60-day Notice + Special Pay]
F --> I[Labour Court]
G --> I
H --> IJapan vs Thailand: Fundamental Differences in Dismissal Regulation
| Comparison | Japan | Thailand |
|---|---|---|
| Freedom to dismiss | Requires objectively reasonable grounds + social reasonableness (abuse of dismissal rights doctrine) | Dismissal is generally permitted; mandatory severance pay applies |
| Notice requirement | 30 days’ advance notice or 30 days’ average wages in lieu | One wage payment period’s advance notice or payment in lieu |
| Statutory severance | None (retirement allowance governed by work rules) | Statutory; up to 400 days’ wages based on length of service |
| Effect of wrongful dismissal | Dismissal void; reinstatement + back pay | Reinstatement or damages (monetary settlement common in practice) |
| Court fees for workers | Attorney fees and other costs required | Workers can file free of charge (no stamp duty) |
| Duration of proceedings | Months to years | Relatively short (months to approximately one year; please verify) |
| Work rules | Amendments judged by a reasonableness standard | Required for workplaces with 10+ employees; amendments generally require unanimous employee consent |
Thailand’s Logic: “You Can Dismiss, but It Isn’t Free”
Japan’s approach starts from the premise that dismissal without just cause is void. Thailand’s approach is different: employers are generally free to dismiss employees, but they must pay statutory severance based on years of service. This is closer to a European-style system — “you have the freedom to dismiss, but you pay for it.” While this gives employers greater flexibility in one sense, the cost of dismissing long-serving employees can be substantial.
The Reality of Thai Labour Courts: What Employers Need to Know
A Court That Is Free for Workers
Thailand has dedicated Labour Courts where workers can file claims without paying stamp duty or court fees. Self-representation without a lawyer is also possible. The barrier to entry for dismissed employees is therefore very low — arguably lower than Japan’s labour tribunal system. Litigation risk must be taken seriously.
Without Evidence, Employers Lose
In Thai labour proceedings, the burden of proving that a dismissal was justified lies with the employer. If an employer proceeds to dismissal without adequate documentation — warning letters, records of counselling sessions, and properly drafted work rules — even a dismissal that falls within one of the six statutory grounds for disciplinary termination can be found wrongful due to insufficient evidence.
“The employee was generally problematic” or “I told them verbally” will not hold up in a Thai Labour Court. Accumulating written evidence is the single most important practical measure.
Overview of This Series
| Part | Topic | Key Content |
|---|---|---|
| Part 1 (this article) | Overview of Thai dismissal rules | 3-layer framework, Japan comparison, Labour Court features |
| Part 2 | Ordinary dismissal procedures and severance | Notice rules, severance calculation table, payment steps, Mermaid diagram |
| Part 3 | Disciplinary dismissal requirements and pitfalls | 6 grounds with examples, warning letters, case law, notice requirements |
| Part 4 | Redundancy, relocation, and mutual agreement | 60-day notice, special pay, agreement clauses, face-saving approach |
| Part 5 | Preventive legal practice | Work rules, evidence checklist, prevention flowchart, series summary |
Conclusion: Start by Knowing the Rules
Thailand’s dismissal framework is fundamentally different from Japan’s. Employers can dismiss, but must pay; workers can sue for free; and without documentation, employers face an uphill battle. Keeping these three points in mind is the foundation of sound HR management in Thailand.
Part 2 will cover the specific procedures for ordinary dismissal and how to calculate severance pay.
Next: Part 2 — “Ordinary Dismissal Procedures and Severance Pay: Amounts, Timelines, and Steps Explained in Full”
For questions about dismissal or employment matters in Thailand, please feel free to contact us.
This article is for general informational purposes about Thailand’s legal system and does not constitute legal advice under Thai law. For specific matters, please consult a Thai-qualified legal professional. Our firm works in collaboration with JTJB International Lawyers’ Thai-qualified attorneys.