Key Takeaways

  1. Employers must adhere to the Labour Protection Act, ensure accurate payroll, and manage statutory contributions to the Social Security Fund and Workmen’s Compensation Fund.
  2. An EOR handles employment contracts, payroll, tax filings, and benefits, allowing your business to operate compliantly without local incorporation.
  3. With minimum wages ranging from THB 337–400 per day and a large labor pool in manufacturing, IT, and services, Thailand presents strong opportunities for regional expansion.
  4. Remote People helps you identify and engage the most suitable EOR for your Thailand hiring needs.

Thailand is one of Southeast Asia’s most vibrant economies, with a GDP of USD 514.8 billion and a workforce of more than 40 million people. They are known for their advanced infrastructure, cost-efficient labor, and openness to foreign investment. Due to this, Thailand has become a strategic destination for global companies seeking regional expansion. In particular, sectors like manufacturing, logistics, hospitality, and digital services are seeing increased demand for skilled and semi-skilled labor.

However, hiring in Thailand involves strict labor regulations governed by the Labour Protection Act (LPA), mandatory contributions to social security, and complex personal income tax rules. Foreign companies must also navigate different minimum wage zones, employee welfare contributions, and local tax reporting requirements.

For businesses that want to build a local team without the time and expense of setting up a Thai company, an Employer of Record (EOR) offers a fast, compliant, and cost-effective solution. An EOR in Thailand becomes the legal employer, managing contracts, payroll, benefits, tax filings, and compliance on your behalf,  so you can hire with confidence.

How to Hire Employees in Thailand

Thailand has a structured employment framework that requires written employment contracts and full compliance with local labor laws. Contracts should clearly specify the job role, compensation, work hours, leave policies, and termination procedures.

According to the Department of Employment, companies employing foreign nationals also need to secure a work permit and a non-immigrant business visa. This process involves coordination with the Ministry of Labour and the Board of Investment (BOI), particularly for BOI-promoted industries.

Employers are expected to keep accurate time and wage records, track statutory leave entitlements, and issue monthly payslips. Non-compliance can result in fines ranging from THB 5,000 to THB 400,000, depending on the violation.

Incorporating an Entity

Setting up a legal business presence in Thailand involves several regulatory steps. The most common structure for foreign investors is a Private Limited Company (Co., Ltd.), which requires at least three shareholders and one director. Foreign ownership is limited to 49% unless the company receives a BOI promotion or operates in a permitted sector.

To establish an entity, companies must:

  1. Reserve a company name with the Department of Business Development (DBD)
  2. File Memorandum of Association and Articles of Incorporation
  3. Register the company and obtain a Company Registration Certificate
  4. Apply for a corporate Tax Identification Number (TIN)
  5. Register with the Social Security Office for employee benefits
  6. Open a corporate bank account

This process takes 4–6 weeks and requires Thai-language documentation, local legal advisors, and physical office space. Foreign businesses must also comply with accounting standards, labor regulations, and tax reporting, which adds ongoing complexity and cost.

Working with an Employer of Record (EOR)

An Employer of Record in Thailand serves as the official employer for labor law and tax purposes. Your company retains control over the employee’s daily responsibilities, performance, and deliverables, while the EOR manages compliance, HR administration, and payroll.

This is good for:

  • Companies without a Thai entity that want to hire quickly
  • Managing short-term expansion, remote teams, or project-based staff
  • Mitigating risk around employment law violations and misclassification

EOR services typically include:

  • Drafting and signing compliant employment contracts in Thai
  • Registering employees with the Social Security Office (SSO)
  • Withholding and filing Personal Income Tax (PIT)
  • Administering paid leave, bonuses, and benefits
  • Ensuring legal termination procedures and severance payments

With an EOR, employees can be onboarded in as little as 7–10 days. Your business avoids the need to rent office space, hire local advisors, or deal with Thai regulatory filings, all while maintaining full operational control.

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Hiring Independent Contractors

Independent contracting is permitted in Thailand, but it carries reclassification risks if the relationship mirrors that of full-time employment. Thai labor authorities may assess the level of control, supervision, work schedule, and integration into the company’s operations to determine if a contractor is, in fact, an employee.

Thai courts have previously ruled in favor of workers who were misclassified, granting them employee status along with back pay, severance, and benefits. This risk is especially high for foreign companies hiring remote Thai workers as contractors without a Thai-registered entity.

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Southeast Asia’s second-largest economy with SSO contributions, Thai Labour Protection Act, severance tiers, and work permit requirements.

We handle employment contracts, payroll, social contributions, and full Thai compliance.

No local entity needed. Your team can start in days.

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Using an Employer of Record in Thailand

When you engage an Employer of Record (EOR) in Thailand, they become the legal employer responsible for handling all statutory employment requirements under Thai law. While your business directs the employee’s daily responsibilities and performance, the EOR ensures that all administrative obligations, such as payroll, taxes, benefits, and labor law compliance, are met accurately and on time.

The EOR operates as the intermediary between your company and the Thai authorities. This includes registering the employee with the Social Security Office (SSO), calculating Personal Income Tax (PIT), handling payments to the Workmen’s Compensation Fund, and issuing monthly payslips in accordance with Thai Revenue Department standards. The EOR also assists in interpreting labor regulations, managing employment contracts, and resolving compliance questions related to the Labour Protection Act (LPA).

Since Thai labor law includes strict termination procedures and mandatory severance based on tenure, the EOR ensures proper notice, documentation, and severance calculation, helping employers avoid wrongful dismissal claims. The EOR also keeps you informed of policy changes issued by the Ministry of Labour that might affect employee rights or employer obligations.

Employment and Labor Laws in Thailand

The primary legislation governing employment in Thailand is the Labour Protection Act B.E. 2541 (1998), along with related laws such as the Social Security Act, Workmen’s Compensation Act, and Labour Relations Act. Together, these laws regulate working hours, wages, leave entitlements, safety standards, and dispute resolution.

Employers are required to:

  • Provide written employment contracts outlining all terms and benefits
  • Maintain accurate records of employee attendance, wage payments, and leave
  • Register employees for Social Security (5% employer contribution) and Workmen’s Compensation (0.2–1.0%)
  • Submit monthly tax filings to the Revenue Department for PIT and contributions

Failure to comply with these laws may result in administrative fines ranging from THB 5,000 to THB 400,000, depending on the nature of the violation. The Department of Labour Protection and Welfare conducts random inspections to enforce compliance.

Thai labor laws are protective of employees and apply equally to Thai and foreign workers, provided they are working in-country. Employers must also respect rights relating to collective bargaining, workplace safety, and statutory severance.

Employment Contract Requirements

Although not legally mandatory, written employment contracts are strongly recommended in Thailand to avoid misunderstandings or legal disputes. In practice, most companies provide bilingual (Thai-English) contracts in compliance with Section 10 of the Labour Protection Act.

A compliant employment contract in Thailand should include:

  • Full legal names and ID numbers 
  • Job title and detailed description of duties
  • Work location
  • Salary details, including base wage, overtime rates, bonuses, and benefits in Thai Baht (THB)
  • Working hours
  • Leave entitlements
  • Probation period terms
  • Termination clauses
  • Social security and tax responsibilities

Contracts must be signed before the employee begins work and stored securely as part of the company’s HR records. Any amendment requires written consent from both the employer and the employee.

Working Hours

According to Section 23 of the Labour Protection Act, standard working hours in Thailand must not exceed 8 hours per day or 48 hours per week for most jobs. For hazardous or physically demanding work, the limit is reduced to 7 hours per day and 42 hours per week.

Employers are also required to provide at least one weekly rest day, normally Sunday, allow for a minimum 1-hour break after 5 consecutive hours of work, and display working hour schedules publicly in the workplace. Flexible arrangements, such as compressed workweeks or shift rotations, are permitted but must be mutually agreed upon and included in the employment contract.

Overtime

Overtime work is regulated under Sections 24–27 of the LPA. Employers may require employees to work beyond standard hours with mutual agreement, except in emergency cases related to safety or operations.

Overtime limits and pay rates are as follows:

Overtime TypeLimit / Compensation
Maximum overtime36 hours per week
Regular overtime150% of the normal hourly wage
Weekend or rest day work200% of the normal hourly wage
Public holiday work300% of the normal hourly wage
Public holiday replacing a rest day400% of the normal hourly wage

Probation Period

Although Thai labor law does not explicitly define a maximum probation period, standard practice limits probation to 119 days to avoid triggering statutory severance obligations.

If the probationary period exceeds 120 days and the employer terminates the contract, the employee may be entitled to statutory severance, just like a permanent hire. Therefore, probation terms must be clearly outlined in the employment contract, and HR practices must align with these timelines to remain compliant.

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Payroll and Employment Taxes in Thailand

Fiscal Year

Thailand’s fiscal year follows the calendar year, running from January 1 to December 31. Employers must finalize annual tax filings, reconcile social security contributions, and issue withholding tax certificates (PND 1 and PND 91) by the end of the fiscal year.

The PIT annual reconciliation deadline for employers is typically March 31 of the following year. Businesses must retain payroll records for at least 5 years.

Payroll Cycles

The standard payroll cycle in Thailand is monthly, and wages must be paid consistently on the agreed-upon payday. Most companies pay employees on the last working day of each month. Any deviation should be outlined in the employment contract.

Minimum Wage

Thailand’s minimum wage is determined by province and reviewed periodically by the National Wage Committee. As of 2026, daily minimum wages range from:

LocationMinimum Daily Wage
Lower-cost provincesTHB 337 per day
Bangkok, Phuket, Chonburi, Rayong, Chachoengsao, Koh Samui district (and certain sectors nationwide)THB 400 per day

Based on a 26-day work month, the monthly minimum wage in high-wage zones (THB 400/day) is approximately THB 10,400 (USD ~270 – 280).

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Bonus Payments

There is no statutory requirement for a 13th-month salary in Thailand. However, it is a common practice, particularly among multinationals, financial institutions, and large domestic companies.

When provided, the 13th-month salary (often referred to as a “bonus”) is typically paid in December or before the Thai New Year (Songkran) in April. Employers should document the bonus policy in the employment contract or internal HR policies.

Employer Tax Contributions

In Thailand, employers are obligated to make several statutory contributions on behalf of their employees. These include payments to the Social Security Fund (SSF), Workmen’s Compensation Fund (WCF), and, in some cases, contributions to the Employee Welfare Fund or Provident Fund (if enrolled). These payments are governed by the Social Security Act B.E. 2533 (1990) and the Workmen’s Compensation Act B.E. 2537 (1994). These employer contributions support various social protection systems, including healthcare, pension, unemployment insurance, maternity, and work-related injury compensation.

The contributions must be calculated accurately and submitted within the statutory deadlines, typically by the 15th of the following month for SSF and annually for WCF. Late or incorrect submissions can attract fines, interest charges, or inspection by the Social Security Office. Contribution caps are based on employee salaries up to a maximum of THB 15,000 per month for SSF and vary for WCF based on the occupational risk classification of the business.

Contribution TypeEmployer RateNotes
Social Security Fund (SSF)5.0% (max THB 750)Applies to salaries up to THB 15,000/month. Covers health, maternity, pension, and more.
Workmen’s Compensation Fund (WCF)0.2% – 1.0% 
Provident Fund (if applicable)2% – 15%Voluntary scheme. Must match employee contributions.
Employee Welfare Fund (if applicable)VariableFor companies with 10+ employees. Specific conditions apply under the Ministry of Labor.

Employee Payroll Contributions

Employees contribute to both the SSF and the Personal Income Tax (PIT). The employee share of SSF is 5% of the monthly salary, capped at THB 750.

Individual Income Tax Contributions

PIT is levied on a progressive scale based on annual income. The tax rates for Thai residents in 2024 are:

Tax Slabs in THBRates
0 – 150,0000%
150,001 – 300,0005%
300,001 – 500,00010%
500,001 – 750,00015%
750,001 – 1,000,00020%
1,000,001 – 2,000,00025%
2,000,001 – 5,000,00030%
Over 5,000,00035%

Non-residents are generally taxed at a flat 15%–35% on Thailand-sourced income, depending on the type of income. Employers are responsible for monthly withholding and annual reconciliation of PIT.

Time Off and Leave in Thailand

Mandatory Leave Entitlements

Under Section 30 of the Labour Protection Act, employees in Thailand who have completed one full year of continuous service are entitled to a minimum of six days of paid annual leave per year. Employers may grant additional days as part of their internal HR policies or collective labor agreements. New employees who have not yet completed one year may receive prorated leave at the employer’s discretion.

Public Holidays

Thailand recognizes at least 13 public holidays per year, though the exact number may vary slightly depending on announcements by the Cabinet. 

Employees are entitled to fully paid leave on public holidays. If employees are required to work on these days, they must be paid at least double their normal daily wage, in accordance with Section 64 of the LPA.

Sick Leave

Employees are entitled to up to 30 days of paid sick leave per year under Section 32 of the Labour Protection Act. Sick leave does not need to be consecutive and can be taken in full or half days.

If an employee is absent for three or more consecutive days, the employer may request a medical certificate.

Parental Leave

Thailand provides statutory maternity leave and limited paternity benefits under the Social Security Act and Labour Protection Act:

  • Maternity Leave: Female employees are entitled to 98 days of maternity leave, which includes prenatal and postnatal periods. The employer is responsible for paying wages for the first 45 days, and the Social Security Fund covers the remaining 53 days at 50% of the employee’s salary (subject to SSF caps).
  • Paternity Leave: Government employees are granted paternity leave, but private-sector employees do not have statutory rights to paid paternity leave unless included in the employer’s policy. Many private companies voluntarily offer 3 to 7 days of paid paternity leave.

Employers must ensure that maternity leave does not impact the employee’s job security or benefits entitlement.

Bereavement Leave

There is no statutory bereavement leave under Thai law. However, it is common practice for employers to grant 3 to 5 days of paid compassionate leave in the event of the death of an immediate family member.

Terminations and Severance in Thailand

Termination

Employment can be terminated either with or without cause, but employers must follow procedures outlined in the Labour Protection Act. Dismissals without cause require advance notice and severance pay, while dismissals for serious misconduct (e.g., dishonesty, negligence, or criminal activity) may be done without compensation.

Terminations must be communicated in writing and should include the reason for termination, final settlement details, and severance (if applicable). Employers are encouraged to consult legal counsel before terminating employees to avoid disputes or unfair dismissal claims.

Notice Periods

Employers and employees must observe a minimum notice period of one full pay cycle, typically 30 days, for termination without cause. This applies to both fixed-term and indefinite contracts unless otherwise specified.

If the employer fails to give notice, they must provide payment in lieu of notice equal to one month’s wages. Dismissals for serious misconduct may be carried out without prior notice or severance.

Employees who are terminated without fault are entitled to severance pay based on their length of service, as defined in Section 118 of the LPA:

Length of ServiceSeverance Pay
120 days to <1 year30 days’ wages
1 year to <3 years90 days’ wages
3 years to <6 years180 days’ wages
6 years to <10 years240 days’ wages
10 years to <20 years300 days’ wages
20 years or more400 days’ wages

Why Hire in Thailand with an EOR?

Thailand offers a compelling combination of a skilled labor force, competitive wages, and a business-friendly environment. However, Thai employment laws can be complex, particularly for foreign companies unfamiliar with the Labour Protection Act, Social Security Act, and the Workmen’s Compensation regulations. These frameworks regulate everything from employee contracts to severance pay, and missteps in compliance can lead to financial penalties or reputational damage.

An Employer of Record (EOR) in Thailand allows companies to legally hire local employees without having to incorporate a business entity. The EOR becomes the legal employer, managing employment contracts, payroll processing, social security contributions, and personal income tax filings. This model is particularly valuable in Thailand, where employer contributions, statutory leave entitlements, and severance payments are tightly regulated. An EOR minimizes compliance risk, accelerates onboarding timelines, and ensures all legal obligations, such as monthly social security filings and proper termination procedures, are fulfilled. It’s an efficient, low-risk way to build your team in Thailand while staying focused on growth and operations.

How to Choose an EOR in Thailand

In Thailand, it’s critical to work with an EOR that understands the legal, tax, and cultural landscape of the local labor market. Here are some things to look for:

Legal and Regulatory Expertise

Choose an EOR with in-country legal professionals who understand the Labour Protection Act, Revenue Code, and the Social Security Office’s requirements. 

Payroll Accuracy and Statutory Compliance

The provider should handle the full scope of payroll administration, such as calculating salaries, managing deductions, submitting PIT filings, and issuing compliant payslips.

Registered Local Entity

Make sure your EOR is properly registered with Thai authorities and recognized as the legal employer for labor and tax purposes.

Transparent Operations and Support

A reliable EOR in Thailand should offer proactive communication, bilingual documentation, and regular legal updates. They should handle everything from onboarding to offboarding, and be able to explain entitlements like 13th-month bonuses, overtime pay, and maternity leave based on your employee profiles.

Expand into Thailand Easily with Remote People’s Employer of Record in Thailand

Remote People supports your expansion into Thailand with comprehensive Employer of Record (EOR) services. From compliance and payroll to onboarding and employee management, we ensure a smooth hiring experience tailored to local regulations.