From historical sites like Khoao Yai National Park to 35 Michelin-starred restaurants to the budget-friendly beauty of Chiang Mai, Thailand is a beautiful place to live in and explore. Thanks to investment in Thailand’s tech sector, it’s also becoming an attractive option for companies looking for skilled IT professionals.
In this article, we’ll explore Thai work culture, how cost-effective it is to hire Thai talent, and the employment laws employers should know before hiring remote workers in Thailand.
Advantages of Hiring in Thailand
Thailand placed 21st in the World Bank’s Ease of Doing Business rankings, but its average wages are lower than those of other regional remote work hubs, like Singapore.
Here’s a quick overview of some key details about Thailand:
- Currency: Thai Baht (THB)
- Language: Thai
- Capital City: Bangkok
- Population: 70 million
Highly Educated Workforce
International investment in Thailand’s technology sector has strengthened in recent years. In turn, the country has increased its focus on STEM (science, technology, engineering, and mathematics) education, deepening the tech talent pool.
Skilled professionals in Thailand are increasingly looking for tech-forward work, seeking positions as web developers, data scientists, and software developers; as well as roles as virtual assistants, call center representatives, and more.
Understanding the Work Culture of Thailand
According to a survey by Deloitte, flexible work-life balance and a high quality of life are top-of-mind for early and mid-career employees in Thailand, leading many to appreciate the benefits of global remote work.
Even when working as part of a remote team, Thai employees maintain cultural norms like “Sanuk,” which means finding enjoyment in their work environment. In practice, this may result in meetings that begin with informal greetings and discussions.
Hiring Compliantly in Thailand
Employment Contracts
While not mandatory under labor laws, it’s recommended that employers create employment contracts to protect both the company and the employee. Contracts can be verbal or written and are categorized as fixed-term or permanent.
Fixed-term contracts are typically used when an employee is being hired for a predetermined period or to work on a specific project. Permanent contracts are open-ended, without a set end date.
Thai law dictates that any employment contract includes, at a minimum:
- Employee’s role and responsibilities
- Compensation
- Benefits
- Termination requirements
Working Hours & Pay
In Thailand, employees are typically guaranteed a minimum wage of around THB 354 per day, increasing to THB 400 in October 2024. The standard work week consists of 48 hours, divided into 8-hour shifts.
Payroll is typically administered monthly. Overtime compensation varies based on the employment contract or collective agreements, with rates ranging from 1.5 times the hourly wage, to three times the regular wage for work performed on holidays.
Probation Periods
Thai employment law doesn’t mandate that employers use probationary periods.
Employer Taxes
Thailand uses a progressive income tax system that ranges from 0% to a maximum of 35%, depending on employee income. Employers are responsible for calculating and deducting income taxes from employee salaries.
Employees and employers each contribute 3% of employee salaries to pension funds, 1.5% of the employee’s salary to health insurance, and 0.5% to unemployment insurance.
Employers are additionally responsible for contributing between 0.2% and 1% of monthly income up to THB 20,000 for work injury insurance.
Employers must submit payroll withholdings and accurate documentation to the Revenue Department by the 7th of the following month.
Termination Process & Severance Pay
Severance pay can be mandatory for full-time employees who have worked at a company for at least 120 days. The amount is determined by the employee’s length of time at the company:
- 120 days-1 year: 30 days of wages
- 1-3 years: 90 days of wages
- 3-6 years: 180 days of wages
- 6-10 years: 240 days of wages
- 10-20 years: 300 days of wages
- 20+ years: 400 days of wages
Contract employees with fixed terms of employment are not eligible for severance.
Paid Leave Laws in Thailand
Vacation & Holiday
Employees who have worked for their employer for at least one year are entitled to six days of paid time off annually. Employers may provide prorated annual leave for employees who have been with the company for less than one year.
Additionally, employees receive several paid days off for public government holidays.
Sick Leave
Employees in Thailand are eligible for up to 30 sick days per year. An employee can take up to three days of sick leave without documentation. After that, they must provide documentation from a medical professional.
Parental Leave
In Thailand, pregnant employees are entitled to 98 days of maternity leave. The employer covers full pay for the initial 45 days, and Social Security provides 50% pay for the next 45. The remaining eight days are unpaid.
There is no legal requirement for paternity leave in the private sector, though the Ministry of Labour encourages it. In the public sector, fathers may take up to 15 paid paternity leave days within 30 days of their child’s birth.
Personal Business Leave
Employees in Thailand are eligible for at least three days of personal business leave per year.
Military Service Leave
Male employees are entitled to 60 days of military service leave annually.
Why Digital Nomads Love Thailand
In June 2024, Thailand announced it would launch the Destination Thailand Visa, which would allow foreign freelancers and independent contractors to stay in the country for up to 180 days at a time, with multiple entries allowed.
It’s not yet clear when travelers can apply, so stay tuned. Additionally, foreigners can apply for the SMART Visa program, which is intended to attract highly skilled talent and entrepreneurs.
It’s easy to see why digital nomads would be drawn to Thailand, thanks to the low cost of living, vibrant nightlife, and varied landscapes.
Mountain cities like Chiang Mai offer options for remote employees and contractors who want a relaxed experience. Phuket’s beaches, particularly Kata Beach, Surin Beach, and Nai Harn Beach, are attractive for budget-minded talent.
Employ Global Talent in Thailand with RemoFirst
An Employer of Record (EOR) like RemoFirst makes it easier to recruit and employ global talent working remotely.
Book a demo to learn more about how an EOR can help you hire employees, administer payroll, ensure legal compliance, and simplify onboarding for your global team in more than 180 countries, including Thailand.
