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What are the definitions of “termination” and “dismissal”?
Termination of employment is an employee’s departure from a job. Termination may be voluntary on the employee’s part, or it may be at the hands of the employer, often in the form of dismissal (firing) or a layoff. Dismissal or firing is generally thought to be the fault of the employee, whereas a layoff is generally done for business reasons (for instance a business slowdown or an economic downturn) outside the employee’s performance.
Dismissal is when the employer chooses to require the employee to leave, generally for a reason which is the fault of the employee. In the case of the dismissal of an employee, the contract ends without notice and without severance pay.
If you decide to dismiss an employee (termination without notice), please pay attention our following advice for a correct termination.
1. Existence of an important reason
Under Thai law, a dismissal is considered under the following circumstances:
- being dishonest in performing duties or intentionally committing a criminal against the employer
- intentionally causing damages to the employer;
- performing an act of negligence which causes severe damages to the employer;
- violating work rules or regulations or disobeying the employer’s orders which are legal and fair and which the employer has already given a warning letter, except in serious cases for which the employer is not required to give a warning;
- neglecting the work duties for a period of three consecutive work days without a reasonable cause, whether or not there is a holiday intervening in such period; and/or
- having been imprisoned by a final judgement.
If one of the aforementioned cases is committed with negligence or is a petty case, the employer must prove that he has suffered a damage.
2. Ultima Ratio (“the last resort”)
The extraordinary termination should always be the last resort. The employer must consider any other measure that may solve the problem like:
- transfer to another workplace or department; and/or
- ordinary termination.
3. Declaration of the dismissal
The employer should name the important reason in the termination letter. If it is missing, the employer cannot invoke to this reason in a future proceeding.
It is commendable to secure oneself with warning letters (please see our FLT memo related to “Warning Letter to Employee”)
4. Provide the employee with the termination letter
The termination letter should be provided via post or personally.
The employee can have the termination reviewed by the Labor Court. If the Labor Court finds that the termination was unjust, the employer may be ordered to letting the employee work under the old conditions.
If it comes to the result the termination was unjust, but the continuation of work is unacceptable, the employer has to compensate for damages.
5. Practical measures
If the employee leaves the organization, certain things need to be managed, for example:
a) Return of property
If the employee used employer property as a part of the job, make sure you collect them. For example:
- company laptop
- office keys
- ID badges
b) Cancellation of any access
You should cancel any access the employee might have to the office. Files, computer files should be protected and make sure that your IT staff cancels passwords to any company digital files. For example:
- disconnect the computer login
- remove the email address from the staff list
- disable entry building code or entry swipe card
For the e-mail-address, make an arrangement with your ID-administrator to determine exactly for how long this account will be active, to avoid unauthorized use by the departing employee.
c) Cancellation of advantages
Make sure that you cancel employee benefits. For example:
- Health-, Dental-, Life-, Disability Insurance
- Stop retirement contribution
d) Final pay
Make sure that your payroll department calculates the final hours of work as well as any unpaid vacation hours and let the employee know when he or she can get them.