The current global situation has the greatest impact on employer–employee relations. Employers are asking whether they should continue paying salaries when there is no work, or whether they should lay off staff. Employees, on the other hand, are asking what will happen if they are dismissed or sent home on unpaid leave without the ability to work remotely.
In a previous article, we discussed what kind of government support employees in quarantine can receive. However, the question remains: does the employer still have salary obligations when a company stops operating?
Let’s start with the worst-case scenarios.
1. Employee infected with coronavirus
Social Security Fund (SSF): covers medical treatment expenses
Employer: paid sick leave for up to 30 days per year
2. Company closed by government order
Employer: no salary obligation, as the employee performs no work
SSF: pays 50% of salary, but not more than 7,500 baht, for a maximum of 2 months
3. Employer temporarily suspends operations (financial difficulties or reduced demand, not force majeure)
Under Thai labour law, an employer may temporarily suspend operations and must pay employees at least 75% of their salary during the suspension.
Conditions:
- A valid business necessity for suspension
- Partial or full suspension decision
- Notification to the Labour Department and employees at least 3 working days in advance
- Mandatory payment of 75% salary throughout the suspension period
Employer: pays 75% of salary
SSF: no payment
4. Employer temporarily suspends operations due to force majeure
SSF: pays 50% of salary, but not more than 7,500 baht, for up to 6 months
Employer: no salary obligation
Note: More detailed information on force majeure is provided in a separate article.
Although the pandemic (coronavirus) is not explicitly defined by law as force majeure, disputes on this matter may only be resolved in court if parties cannot agree.
However, employers may submit a request to suspend operations due to COVID-19, in which case employees become eligible for SSF compensation of 50% of salary.
5. Employer terminates the employee
SSF: pays 70% of salary, but not more than 7,500 baht, for up to 200 days
Employer: pays severance compensation depending on the employee’s length of service
Summary Table (translated from the infographic)
| Situation | Employer Payments | Social Security Fund (SSF) Payments |
|---|---|---|
| Employee infected with coronavirus | Paid sick leave up to 30 days/year | Covers treatment expenses |
| Company closed by government order | — | 50% of salary, max 7,500 baht, up to 2 months |
| Temporary suspension due to financial difficulties | 75% of salary | — |
| Temporary suspension due to force majeure | — | 50% of salary, max 7,500 baht, up to 6 months |
| Employee termination | Severance pay according to employment duration | 70% of salary, max 7,500 baht, up to 200 days |
In any case, the best solution is mutual understanding and compromise between employer and employee, so that after the crisis both sides can continue productive cooperation.