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Cabinet Approves Updates to Thailand’s Labour Relations Act

  • May 29, 2017
  • Comments Off on Cabinet Approves Updates to Thailand’s Labour Relations Act

Thailand’s Labour Relations Act B.E. 2518 (1975) (“LRA”) governs the collective bargaining relationship between employers and employees as a group (such as employee unions or committees), not to be confused with the Labour Protection Act B.E. 2541 (1998) (“LPA”), which governs the relationship between employers and individual employees.

While the LPA has undergone regular amendments since its enactment to address changes in Thailand’s labour market and to keep Thailand competitive with its neighbors, the LRA has essentially remained unchanged over the past 42 years. Recently, however, the Thai cabinet has approved amendments to the LRA with the goal of updating its collective bargaining provisions. While the amendments require legislative approval to become law, a summary of the more significant amendments is as follows:

1. Timing of Changes to Employment Conditions. Changes to an “agreement relating to conditions of employment” must be made within the 60 day period preceding its expiry date (Section 14 paragraph 2). Otherwise, the terms of the original agreement will apply for another year.

2. Threshold for Requesting Change in Employment Conditions. A demand by employees for a change in employment conditions requires signatures of at least 15% of the employees. However, employers often challenged these demands as employees would sometimes withdraw their names following submission of the demand, such that the 15% threshold was no longer met. Under the amendments, the 15% requirement only applies at the time the demand is submitted by the employees (Section 14 paragraph 4).

3. Timing of Negotiations. The employer and the employees are required to begin negotiations within five days of any demand concerning employment conditions (Section 17). Previously, negotiations had to begin within three days.

4. Adviser Qualifications. The adviser appointed by the employer or the employees to assist in any negotiations concerning a demand for employment conditions is no longer required to be “a person who has been registered as the adviser”.

5. Notifications to Conciliation Officials. The time frame for notifying the Conciliation Official of any demand for a change in employment conditions has been increased from 24 hours to 48 hours (Section 22).

6. Treatment of Unresolved Demands For Changes in Employment Conditions. Demands for a change in employment conditions which have not been resolved by the employer and employees and have been forwarded to the Conciliation Official may be returned to the employer and employees for further discussion in the event the Conciliation Official does not propose a settlement (Section 23). Previously, the LRA provided that the Conciliation Official had to forward the matter to a labour dispute arbitrator, permit a lock-out or strike or propose the involvement of other parties.

7. Setting Up Employment Committee Simplified. Employees at business with 50 or more employees may now set up an Employee Committee without having to follow “the rules and procedures for election of the Committee members as prescribed be the Director- General”.

8. New Promoted Labour Relations Committee. The amendments create a new committee called “the Promoted Labour Relations Committee”, whose main duty is to promote relations between employer and employees and prevent labour disputes. Previously, the only committee under the LRA was the “Labour Relations Committee”, which oversees settlements of labour disputes between employer and employees.

9. Foreign Members of Employment Committees. Foreign employees can now be elected to the board of a Labour Union Committee provided they do not constitute in excess of 1/5 of the board members (Section 102).

10. Unacceptable Labour Relations Committee Decisions. In the event that a decision of a labour dispute case by the Labour Relations Committee is not acceptable by the employer or employees, the decision may then be appealed to the Labour Court within 30 days, with the appealing party depositing security in the same amount as was required by the Labour Relations Committee.

We will continue to monitor developments of these amendments and will publish a news item on our website if they become law. For more information on Thai labour law in general, please see the knowledge section of our website here.