Hire Employees in Thailand

Your own entity is normally a Thai limited company, but foreign majority ownership triggers the Foreign Business Act. Restricted service activities require a Foreign Business Licence, BOI promotion, or qualification under a treaty such as the US Treaty of Amity.

An Employer of Record inverts the sequence: the Thai entity signs the contract, registers the employee with the Social Security Office, withholds personal income tax and provisions severance — while you direct the day-to-day work.

An EOR resolves the employment question but not the licensing one. It is the right vehicle for hiring engineers, support staff or a country manager; it does not authorise you to conduct restricted business in Thailand through those people.

Thailand's Foreign Business Act is what usually decides the model, not cost. A foreign-majority company is restricted from a long list of service activities unless it holds a Foreign Business Licence, obtains BOI promotion, or qualifies under a treaty such as the US Treaty of Amity. That constraint is structural: it does not go away with scale, and it means incorporation is a legal question before it is a commercial one.

An EOR avoids the question entirely for employment purposes, though it does not license you to conduct restricted business in Thailand. It is the right vehicle for hiring engineers, support staff or a country manager while the licensing route is worked out — and the wrong one if the local team is going to be selling and contracting, which raises both FBA and permanent establishment issues.

Employer cost is genuinely low. The Social Security Fund is 5% on each side but the ceiling is only THB 17,500 a month, so the maximum employer contribution is THB 875 — under 1% of a professional salary. The temporary regional relief reducing the rate to 3% has applied in defined periods, so check which rate governs the month being processed.

The real cost sits at the exit. Thai severance runs to 400 days' wages at twenty years of service, and it is payable on termination without cause regardless of notice. Employers who model Thailand on its contribution rate alone are looking at the wrong number entirely.

Break-even rule of thumb: EOR fees begin to exceed the running cost of a small Thai entity somewhere between 15 and 20 employees. Model both before committing — see EOR vs Entity for the full comparison, and plan any later migration so employees keep seniority.

The Social Security Fund is 5% from each side, capped at monthly earnings of THB 17,500 — a maximum employer contribution of THB 875, which on a professional salary is under 1%. A temporary reduction to 3% has applied in defined periods, so confirm which rate governs the month being processed.

Workmen’s compensation is separate, employer-funded, and rated by activity from 0.2% to 1% of annual wages up to a ceiling.

The number that matters is not the contribution rate but the severance scale. Thai severance runs to 400 days’ wages at twenty years of service and is payable on termination without one of the narrow statutory causes — redundancy included. An employer modelling Thailand on its 1% contribution is looking at the wrong figure entirely.

The ceiling moved on 1 January 2026 for the first time in roughly twenty years, and the next two steps are already fixed. The 5% rate is unchanged, but the wage ceiling rose from THB 15,000 to THB 17,500, taking the maximum contribution per party from THB 750 to THB 875. It rises to THB 20,000 in 2029 and THB 23,000 in 2032 — unusually, a multi-year schedule that can be modelled rather than guessed at. Only employees earning above THB 15,000 are affected, and any source still quoting a THB 15,000 cap is describing last year. A new employer cost arrives in October 2026: the Employee Welfare Fund, providing severance protection separate from social security. Employers running an SEC-registered Provident Fund are exempt — but only if every eligible employee is covered, so staff excluded from the Provident Fund, typically those on probation, must be enrolled in the Welfare Fund individually.

Four representative profiles, costed with the 2026 contribution rates above. Salaries are illustrative market midpoints, not GX operating data — use them to see how the on-cost percentage behaves as pay rises, not as a salary benchmark for a specific role. For real market data on your roles, ask for a costing.

Because the main charges are capped, the on-cost percentage falls sharply above the ceiling. Model a senior hire explicitly rather than scaling the junior figure — the error runs in your favour but it distorts the comparison against uncapped markets.

Four representative profiles costed on 2026 statutory rates. Salaries are illustrative market midpoints, not GX operating data.

Payroll runs monthly in baht. Personal income tax is withheld under the PND 1 return and remitted by the seventh of the following month, or the fifteenth when filing online. Social Security contributions are due by the fifteenth.

Personal income tax is progressive from 5% to 35% across seven bands, with a personal allowance, a spouse and child allowance, and a standard expense deduction of 50% of employment income capped at THB 100,000.

There is no statutory thirteenth month, but an annual bonus of one to two months is strong market practice in professional roles and is treated as expected. Where it is written into the contract or paid consistently it becomes difficult to withdraw without dispute.

Thresholds and ceilings are uprated periodically, so a figure correct in January may not hold later in the year. Where a row below is flagged, published sources disagreed and the conflict is recorded rather than resolved.

Thresholds move on a local cycle that does not always fall in January, so a figure correct at the start of the year may not hold through it. Where a row below carries a flag, published sources disagreed and the conflict is recorded rather than resolved — there are 9 such rows on this page.

The sections that follow set out contracts and probation, working time, leave, termination and immigration in that order. Where an entitlement comes from a collective agreement rather than statute it is marked as such, because that distinction determines whether it is negotiable.

A written contract is not strictly mandatory but is universal in practice, and the employer must provide written particulars. Thai is the working language for filings; bilingual contracts are common and the Thai text governs where they diverge.

Probation is not a statutory concept in Thailand, which surprises foreign employers. A probationary period may be agreed, but it does not suspend severance: an employee terminated after 120 days of service is entitled to severance regardless of what the probation clause says.

That 120-day point is therefore the real decision date. Before it, termination costs notice only; after it, the severance scale begins at 30 days’ wages and climbs.

Eight hours a day and 48 a week for general work, reduced to 42 for hazardous work. Overtime requires consent and is capped at 36 hours a week including holiday work. Premiums are 1.5 times on a normal working day, 1 additional time for holiday work within normal hours, and 3 times for overtime on a holiday.

Overtime is where payroll disputes usually start. Record hours from day one even where the role is salaried and the expectation is that overtime will not arise — reconstructing records after a complaint is far harder than keeping them.

Overtime is where payroll disputes usually begin, and the burden of proving hours worked generally sits with the employer. Record hours from the first day even for salaried roles where overtime is not expected — reconstructing a record after a complaint is considerably harder than keeping one.

Public holidays sit on top of the annual leave entitlement. Where a holiday falls at a weekend, practice varies — some markets move it, some grant a substitute day and some do neither, so check the position before assuming a day in lieu.

The 18 dates below are the statutory position. Employers in many markets grant more by policy or collective agreement, and sector agreements sometimes add local or patronal days that do not appear in a national list.

Thailand observes 18 paid public holidays in 2026. Dates that fall at a weekend and any substitution rules are set out below; entitlement is separate from annual leave.

Maternity: 98 days including holidays — 45 days paid by the employer; a further 45 days from social security at 50% of wages. Paternity: No statutory entitlement in the private sector — Commonly 3 to 5 days by company policy. Sick leave: Up to 30 days a year on full pay — Employer-paid. A medical certificate may be required from the third consecutive day. Business leave: 3 days a year — Full pay, employer-funded, for necessary personal business.

Military service: Up to 60 days a year — Full pay, employer-funded. Sterilisation leave: As certified by a doctor — Full pay, employer-funded.

Thai severance is the largest statutory exit cost in this guide relative to salary. It rises on a scale from 30 days' wages at 120 days of service to 400 days at twenty years, and it is payable whenever the employer terminates without one of the narrow statutory causes — dishonesty, wilful damage, gross negligence, or a criminal act against the employer.

Notice is separate and additional: one pay period, effectively up to a month, or payment in lieu. Redundancy for business reasons is not a statutory cause, so restructuring attracts the full severance scale.

Where termination is for relocation of the workplace or introduction of machinery that reduces headcount, additional special severance applies on top. Employers should also expect unfair dismissal claims through the Labour Court, which has wide discretion to order reinstatement or additional damages where the reason given is not made out.

A foreign national needs a Non-Immigrant B visa and then a work permit, tied to the employer, the role and the work location. Changing any of the three requires the permit to be amended.

The four-to-one ratio is the structural constraint: a Thai company generally must employ four Thai nationals for each foreign worker, and maintain registered capital of THB 2 million per permit. BOI-promoted companies and those in specified zones operate under relaxed conditions.

Allow four to eight weeks once the ratio and capital requirements are satisfied. The Smart Visa route offers a faster path for qualifying technology and expert roles.

Severance dominates Thai compliance risk because it is large, accrues from 120 days, and applies to redundancy. Employers who treat restructuring as a low-cost exit discover the scale at the point of decision.

The second recurring issue is the work permit’s specificity. It names the employer, the role and the location, and working outside those terms is a breach by both the employee and the employer.

Practical controls: provision severance from day 120 rather than at exit, confirm which Social Security rate applies each month, keep the four-to-one ratio current before making a foreign offer, and record the reason for any termination in writing at the time.

Work backwards from the start date. For a Thai national through an EOR, one to two weeks is realistic. A foreign national needs a Non-Immigrant B visa and then a work permit, which together add four to eight weeks — and the work permit is tied to the employer, the role and the work location.

Confirm before making an offer: whether the role can lawfully be performed by a foreign national, since Thailand reserves a schedule of occupations; whether the four-Thai-employees-per-foreigner ratio can be met, which an EOR arrangement addresses differently from a own-entity one; and what the severance exposure looks like at two and five years, because that is the number that will matter.

Social Security registration is due within 30 days of the employee starting. Provident fund arrangements, where offered, are established through a licensed fund manager rather than run in-house.