Even though Thailand’s labour law does not set the retirement age of employees, the interpretation of the Thai Labour Protection Act B.E. 2541 (1998) includes the fact that the retirement of employees is a termination of contract of employment. In case, an employer has included a retirement age in the work regulation, the employer shall pay Severance Pay to the employees who are terminated by the retirement age, in condition that the employees have worked for an uninterrupted period commencing from the first working day to the retirement date as stipulated in Section 118.
However, the Employers are not required to include a retirement age of employees in the regulation of the company. It means that when the employees has reached an age that they should retire, but there is no retirement age specified in the regulation of the company, they have 2 choices; to resign or to continue working. They are not entitled to receive payment of such Severance Pay from the Employers after resignation.
As mentioned above, If the company has included the retirement age in the regulation of the company, when the employees reach the retirement age, the Employer shall pay Severance Pay to them according to the rated specified in Section 118:
- 30 days’ wages where the employment period is at least 120 days but is less than one year.
- 90 days’ wages where the employment period is at least one year but is less than three years.
- 180 days’ wages where the employment period is at least three years but is less than six years.
- 240 days’ wages where the employment period is at least six years but is less than ten years.
- 300 days’ wages where the employment period is ten years or more.
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