Hiring skilled employees in Thailand is often seen as a complicated and costly process with numerous compliance risks — but it doesn’t have to be. Working with an Employer of Record (EOR) platform, like Borderless, makes hiring employees abroad a seamless process.
This article will guide you through the reasons and benefits of using an EOR to hire employees in Thailand.
Why Hire Talent in Thailand?
As part of the ASEAN Economic Community and in the middle of Southeast Asia, Thailand is strategically located. At the heart of Thailand is Bangkok, a booming metropolis with rapid tech innovation.
Thailand’s well educated workforce and skilled workers in digital marketing, engineering and software development makes it a desirable place for employers looking to hire talent abroad.
Plus, the country’s low cost of living is an opportunity to minimize costs without sacrificing skill..
How to Legally Hire Employees from Thailand
There are a few ways employers can hire talent from Thailand. Employers can draft independent contractor agreements; however, these come with risks of misclassification and don't grant employee status to the new hire.
A more complicated route involves setting up a physical business entity. Doing this is costly, time-consuming, and comes with many complexities, especially when it comes down to complying with local labor laws and regulations.
A third, popular, and stress-free route involves using an Employer of Record (EOR) platform. An EOR is a third-party organization that acts as a broker for hiring talent outside the country where the employers operate.
Using an EOR to hire employees in Thailand makes the process seamless and compliant.
What Does an Employer of Record Do?
An EOR provides an efficient and compliant way for organizations looking to recruit and hire talent from abroad. They take care of tedious administrative tasks associated with employment contracts, onboarding, tax documentation and filing, payroll processing, intellectual property protection, and termination.
With labor laws constantly changing across the world, using an EOR guarantees that you maintain strict compliance, no matter where you hire talent.
Contracts and Documentation
Laws surrounding employment contracts are different in each country. While some countries require employment contracts to be in writing, Thailand doesn’t. Employment contracts in Thailand can be oral or in writing, however, it is recommended that it be the latter.
Thai law also has many restrictions surrounding fixed-term employment contracts. Fixed-term contracts may only be used for a special project that’s outside of business norms, to complete work of a temporary nature, or for seasonal work. Fixed-term employment contracts must not exceed two years.
Employment contracts must also include the date, names, start date, probationary period, and salary.
Working with an EOR will ensure that the right contact is in place, containing all the necessary information and complying with local employment law. An EOR will also make sure that all the correct information is collected, such as work permits, banking information, and more.
Insurance and Benefits
Using an EOR to hire employees in Thailand will guarantee that employees have proper insurance coverage and the necessary benefits required by local laws and regulations. This includes healthcare and unemployment benefits.
An EOR will also take care of supplemental benefits for employees, like dental, vision, life insurance, and retirement savings plans. With global hiring becoming more and more competitive, it pays to offer employees attractive additional benefits.
Paid Time Off, Leave, and Public Holidays
Employers looking to hire in Thailand need to be aware of paid time off allowances, types of leave, and public holidays. Thai employees are entitled to six days off after working one year for an employer. If an employee falls ill, they are entitled to 30 days of paid sick leave each year.
New mothers are entitled to 98 days of maternity leave, however, only the first 45 days are paid for by the employer. The rest of an employee’s maternity leave is paid by Social Security.
Other types of leave include personal business leave, sterilization leave, and military service leave.
Thailand has 14 public holidays, in which employees are not required to work. As of 2023, Thai public holidays are as follows:
- January 1: New Years’ Day
- March 6: Makha Bucha Day
- April 6: Chakri Day
- April 13-15: Songkran (Thai New Year)
- May 1: Labour Day
- May 4: Visakha Bucha Day
- May 5: Coronation Day
- July 1: Mid-Year Bank Holiday
- August 1: Asarnha Bucha Day
- August 12: HM The Queen’s Birthday
- October 23: Chulalongkorn Day
- December 5: HM The King’s Birthday
- December 10: Constitution Day
- December 31: New Year’s Eve
Navigating paid time off, leave, and holidays in Thailand can be complicated. While there are guides and practices for employers to manage PTO on a global team, an EOR will ensure everything is properly tracked and calculated.
Tax Obligations
Employers in Thailand have numerous tax obligations and social security contributions. Employers are responsible for calculating, deducting, and paying the amount to the authorities. Keeping up with paying and filing taxes can be a lengthy, complicated process. Fortunately, an EOR will handle all the logistics and ensure that all taxes are filed compliantly.
Employer Responsibilities
While the EOR takes care of all legal and HR procedures, like contracts, payroll, and taxes, the employer also has some responsibilities. The employer needs to take on responsibilities as if they were hiring a local candidate; this includes recruitment, interviewing, and onboarding. Once the employee is onboarded, it’s the employer’s responsibility to maintain the subordinate working relationship.
It’s also up to the employer to be aware of the working culture in Thailand and connect with employees. This will create a positive and welcoming work environment that encourages communication and inclusivity, ultimately helping with employee performance and retention.
Advantages of Using an Employer of Record
Using an EOR in Thailand will save time, reduce costs, and minimize compliance risks. Setting up an entity in a foreign country comes with a lot of stress. An EOR is already set up to hire employees abroad, making it a seamless and efficient process.
EORs have local knowledge and extensive experience in maneuvering through intricate HR processes, so employers won’t need to worry about any potential compliance or legal issues.
Other than minimizing the stress of hiring globally, working with an EOR is cost-saving and ensures a positive employee experience with streamlined HR support.
Choosing the Right Employer of Record
When it comes to choosing the right EOR, employers must do their due diligence in order to find the right partner. Employers should take various factors into consideration.
- Experience and expertise: When working with an EOR in Thailand, you want to make sure they have local knowledge of employment laws and experience in the country. Working with an EOR with a positive reputation in Nicaragua ensures compliance.
- Range of services: Keep in mind the range of services offered by EORs and see if they are right for you. Look for different services related to hiring staff, like administering benefits, filing taxes, compliance and governance, and legal support.
- Data security: In a remote work environment, protecting intellectual property is vital. When choosing an EOR vendor, make sure it has a specific agreement which outlines the ways it aims to keep sensitive information secure.
Borderless — The EOR For You
If you’re looking to hire an employee in Thailand, an EOR is the right solution. With Borderless, we make the hiring process a breeze. While you connect with your employees, we’ll do the heavy lifting to guarantee compliance and make hiring a seamless, stress-free process.
Book a demo to see how we can streamline hiring employees from Thailand.
Disclaimer
Borderless does not provide legal services or legal advice to anyone. This includes customers, contractors, employees, partners, and the general public. We are not lawyers or paralegals. Please read our full disclaimer here.
