Overtime work

Keywords: Mazars, Thailand, Legal, Labour Protection Act, Overtime

7 October 2022

Under the Labour Protection Act (“the LPA”), an employer cannot require an employee to work overtime on a workday unless the employee has agreed to do so on each occasion, and the beginning and end of the overtime work period has been set in advance. In addition, the LPA states that an employer cannot require an employee to work on a holiday. However, if the nature of the work is such that it must be done consecutively, and if stopped, will cause damages, or if the work is due to an emergency, or the work is prescribed in a ministerial regulation, the prior agreement of the employee is not required.

Can employees work overtime without the employer’s consent?

Employers are not required to provide regular overtime pay or holiday overtime pay to employees if the employees work overtime without the employer’s consent.

Regular overtime and holiday overtime pay

If an employer would like an employee to work overtime, the employer must provide regular overtime pay on workdays or holiday overtime pay on holidays, based on the rates set out in the LPA.

Calculating overtime pay

Under the LPA, an employer must provide overtime pay to an employee of at least 1.5 times the employee’s hourly wage for a workday for the number of overtime hours worked, or, where an employee receives wages on a per piece basis, the employer must pay at least 1.5 times the per piece rate of wages for a workday for the overtime work done.

Example         

If regular working hours are from 8 a.m. to 5 p.m., with normal workdays being Monday through Friday, with a break from noon to 1 p.m., and an employee receives monthly wages of THB 12,000, then:

• The employee’s daily wage is THB 400 (THB 12,000 divided by 30 days) and his hourly wage is THB 50 (THB 400 divided by 8 hours).
• Regular overtime pay on workdays is 1.5 times the hourly wage, so the employee will receive overtime pay of 75 THB (THB 50 x 1.5 per hour).
• If the employee works from 7 a.m. to 9 p.m. on Monday, he will work overtime for 5 hours. Therefore, the employee is entitled to regular overtime pay of THB 375 (THB 75 x 5 hours).

Calculating holiday overtime pay

Under the LPA, an employee is entitled to receive holiday pay and holiday overtime pay as follows:

1. Holiday pay

An employer must provide holiday pay of at least 1 time the hourly wage for a workday for the number of hours worked.

2. Holiday overtime pay

An employer must provide holiday overtime pay of at least 3 times the hourly wage for a workday for the number of hours worked.

Example   

If regular working hours are from 8 a.m. to 5 p.m., with normal workdays being Monday through Friday, with a break from noon to 1 p.m., with Saturday and Sunday as holidays (days off), and an employee receives monthly wages of THB 12,000, then:

• The employee’s daily wage is THB 400 (THB 12,000 divided by 30 days) and his hourly wage is THB 50 (THB 400 divided by 8 hours).
• Holiday overtime pay is 3 times the hourly wage, so the employee will receive an hourly wage of THB 150 (THB 50 x 3).
• If the employee works on Saturday from 8 a.m. to 8 p.m., he will work for 8 hours and 3 hours overtime on a holiday. Therefore, the employee is entitled to holiday pay of THB 400 (THB 50 x 8 hours) and holiday overtime pay of THB 450 (THB 150 x 3 hours)

Can regular overtime pay / holiday overtime pay be included when calculating severance pay?

When the employer terminates the employment of the employee without a justifiable reason, as set out in the LPA, severance pay must be calculated from wages, which is the money paid in return for the employee’s work done during normal working hours only. Therefore, pay provided outside of normal working hours or on holidays, such as regular overtime pay or holiday overtime pay, is not part of wages, and cannot be included when calculating severance pay.

Can regular overtime pay / holiday pay be paid in forms other than money?

The LPA clearly states that overtime pay, both regular overtime pay and holiday overtime pay, must be paid to an employee as money, and cannot be converted to other assets or benefits. Therefore, if an employer and an employee agree on the employee receiving regular overtime pay / holiday overtime pay in a form other than money, such as using overtime hours to take as time off, the employee is still entitled to receive regular overtime pay / holiday overtime pay at the rates set out in the LPA. Furthermore, under the LPA, if an employer does not comply with this requirement, he may be sentenced to prison for not more than 6 months or pay a fine of not more than THB 100,000, or both.