Employer Contribution in Thailand
Thailand, often hailed as the ‘Land of Smiles,’ is renowned not just for its warm and friendly people but also for its unwavering commitment to social security. In fact, employers hold a crucial responsibility of regularly contributing to social security programs, showcasing their dedication to the well-being and security of their workforce. Needless to say, compliance with these obligations ensures their employees’ access to essential benefits and fosters a positive work environment in this culturally rich country.
In Thailand, the Social Security Office (SSO) oversees the vital role of administering social security programs and ensuring the provision of benefits for various circumstances such as injury, sickness, disability, death, child delivery, child welfare, old age, and unemployment. According to Section 33 of the Social Security Act B.E. 2533 (1990), the responsibility of remitting the necessary contributions to fund these programs lies with the Government, employers, and insured individuals themselves. It is important to keep in mind that the monthly insurable salary base used to calculate these contributions is capped at THB 15,000, regardless of the actual salary received by the insured individual. Effective from January 1, 2023, the contribution rates are distributed as follows:
|Contribution Category||Government (%)||Employer (%)||Insured Person (%)|
|Injury, Sickness, Disability, Death, Child Delivery||1.5||1.5||1.5|
|Child Welfare, Old Age||1||3||3|
In addition to the above Social Security Fund, employers are also obligated to contribute to the Workmen’s Compensation Fund, as stipulated by the Workmen’s Compensation Act. The contribution rate for this fund ranges from 0.2% to 1% and it is calculated based on the annual salary of up to THB 240,000.
Health Insurance in Thailand
Thai social security offers universal medical coverage for various situations, including sickness, disability, death, and child delivery. To be eligible for these benefits, insured individuals must have paid contributions for at least 3 months within the 15 months prior to receiving the relevant medical care. Furthermore, Thai social security also provides access to medical facilities for diagnostic tests and treatments, along with coverage for hospital expenses and other benefits.
A concise summary of all the benefits involved is as follows:
|Medical Treatment||Insured individuals can receive free medical treatment at registered medical centers in the SSO’s network. Emergency treatments at private hospitals are also covered within 72 hours without upfront payment.|
|Dental Treatment||Coverage includes tooth extraction, filling, cleaning, and wisdom tooth removal, up to a prescribed annual limit.|
|Public and Private Hospital Care||Reimbursement rates vary between public and private hospitals, with specific limits prescribed for different treatments.|
|Childbirth Benefits||Insured individuals who have contributed for the minimum eligibility period are entitled to a lump sum medical service fee to support the medical expenses related to childbirth.|
|Maternity Benefits||Insured female employees may receive maternity benefits to ensure that they receive sufficient support during their maternity period.|
|Sick Leave Cash Benefit||If an insured person is not receiving wages from their employer, the SSO provides a cash benefit equal to 50% of their wages during their sick leave. The duration of sick leave is limited to 90 days at a time and a maximum of 180 days per year, with extensions being allowed for chronic diseases.|
Old Age and Child Welfare Insurance in Thailand
To qualify for an old age pension, individuals need to have contributed for at least an aggregate of 180 months. They must also be at least 55 years old and have ceased employment. Meeting these criteria entitles individuals to a monthly pension equivalent to 20% of their average wage in their last 60 months of contributions. Those who have contributed for over 180 months may receive a higher pension rate. In the unfortunate event of the pensioner’s death within 5 years of receiving their pension benefits, their next-of-kin may be eligible for 10 times the monthly pension amount. To claim these benefits, individuals must complete the necessary form and submit it to the relevant Social Security offices.
Regarding child allowance benefits, insured individuals who have contributed for at least 12 months within the preceding 36-month period shall be eligible to receive a prescribed monthly allowance per child. The insured person can claim this benefit for up to 3 children, unless they are disabled or deceased. Furthermore, only children under 6 years old qualify for this benefit, and the entitlement to this allowance shall end when the child reaches 6 years old. This allowance shall also cease to be payable in the event of the child’s death, if the child is being raised for adoption by someone else, or if the insured person’s insurance coverage is terminated. Applicants must complete an application form and provide documents such as birth certificates and proof of a bank account.
Unemployment Insurance in Thailand provides benefits to insured individuals who have contributed to the Thai social security system for at least 6 months within the 15 months prior to their unemployment. To be eligible for unemployment benefits, the insured individual must be unemployed for more than 8 days and must have registered as unemployed within 30 days from the date of their termination. It is also necessary to report their employment status online at least once a month. Additionally, eligible individuals should be capable and ready to perform suitable work, not refuse an internship opportunity, and their unemployment should not be due to the following reasons:
|Malpractice, such as intentionally committing a criminal offense against the employer|
|Intentionally causing damage to the employer|
|In serious cases, the violation of work regulations or lawful orders|
|Being absent from duty for 7 consecutive working days without reasonable cause|
|Causing serious damage to the employer due to negligence|
|Being sentenced to imprisonment|
|Retirement, if they are entitled to receive compensation benefits in case of old age|
The Workmen’s Compensation Act 1994 (WCA) outlines employers’ responsibilities for compensation, while the Workmen’s Compensation Fund replaces employer liability for injury, disease, disability, or death resulting from employment. The Fund rates range from 0.2% to 1% of wages and shall be fully paid by employers based on the risk rating of their establishments. Coverage under the Compensation Fund includes medical expenses, compensation for inability to work, loss of physical abilities, disability, death or disappearance, work rehabilitation fees, and funeral expenses. It is worth noting that all these benefits are subject to their respective eligibility criteria.
Moreover, employers have specific obligations when it comes to sending their employees for treatment in the event of a work-related harm or illness. They will have to ensure that their employees receive appropriate medical care by filling out the referral form (KorThor. 44) and presenting it to the designated medical facility at the Compensation Fund Office. Employers must also submit a copy of the form, along with a danger or illness report (Kor Kor. 16) and a medical certificate, to the Social Security Office. If the Workmen’s Compensation Fund or Social Security Office determines that the employee is not eligible for compensation, the employer remains responsible for paying the employee’s medical expenses directly to the treating hospital.
Slasify: Simplifying Payroll in Thailand
Concluding our in-depth look into employer contributions in Thailand and the comprehensive set of benefits they involve, it is important to acknowledge the distinct payroll landscape that prevails within the country. To effectively navigate this landscape and ensure compliance, seeking guidance from industry experts is highly recommended.
At Slasify, we specialize in providing comprehensive payroll solutions tailored to the specific needs of businesses operating in Thailand. Our team of professionals possesses in-depth knowledge and expertise in understanding Thailand’s labor regulations, enabling us to streamline your payroll processes seamlessly. Connect with us today to leverage our experience and expertise, and experience hassle-free payroll management in Thailand.
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