Hire employees in Thailand
What a foreign company needs to know before employing people in Thailand: whether you need a Thai company given the Foreign Business Act, what an employee costs once Social Security, a year-end bonus and the new Employee Welfare Fund are added, how the provincial minimum wage works, why severance applies to every dismissal and retirement, and what the work permit rules demand for foreign hires. Written for CHROs, CFOs, General Counsel and founders.
Quick answers
The questions leadership teams ask first.
Do I need a Thai company to hire?
No. There are three routes:
- Employer of Record. Dryft Global employs the person through a compliant Thai entity, registers them with the Social Security Office, withholds tax monthly on PND 1, issues Thai work rules and handles notice and severance. You direct the work.
- Direct Thai company. Foreign ownership of 50% or more makes your company "foreign" under the Foreign Business Act, so most service activities need a Foreign Business Licence, BOI promotion or US Treaty of Amity status: 2 weeks to 6 months before first payroll, depending on the route.
- Independent contractor. Lawful only for a genuinely independent business delivering a result. If the person works like an employee, a Thai court will treat them as one.
When should I use an EOR instead of setting up a Thai company?
Use an EOR for your first hires, for teams of roughly 1 to 30 people, and wherever Foreign Business Act structuring or a BOI application would hold up the hire for months. Your own company earns its keep for a large team, a BOI-promoted operation, an International Business Center, or a business selling to Thai customers.
What does an employee actually cost beyond salary?
Very little by statute on a professional salary. Social Security is 5% on wages up to THB 17,500 a month, so the employer pays at most THB 875 a month. Workmen's Compensation adds a small annual premium, and the Employee Welfare Fund adds 0.25% from January 2027. The real cost is custom: a year-end bonus of about a month, a provident fund match of 3% to 5% and group health cover. Plan for 12% to 20% all-in.
How difficult is termination in Thailand?
The process is simple; the cost is not. Notice is one pay cycle, and you can pay in lieu. But statutory severance is due on every termination by the employer after 120 days of service, from 30 days' pay up to 400 days' pay after 20 years, and it applies to retirement too. Summary dismissal without severance is limited to listed causes, and the reason must be stated at the time.
Can Dryft Global legally employ my team in Thailand?
Yes. Dryft Global acts as the legal employer in Thailand. We issue bilingual contracts and Thai work rules, register employees with Social Security within 30 days, withhold and file tax on PND 1, issue 50 Tawi certificates, administer leave under the December 2025 amendments, and manage notice and severance under the Labour Protection Act. Pay and benefits are aligned with your own Thai staff, as Section 11/1 requires.
Hiring routes compared
Speed, ownership structuring, work permits and liability differ by route.
| Factor | Direct Thai company | Dryft Global EOR | Independent contractor |
|---|---|---|---|
| Time to first payroll | 2 weeks to 6 months | Days to 2 weeks | Days |
| Foreign ownership structuring | Licence, BOI or Treaty of Amity | Not needed | Not needed |
| Social Security and PND 1 | Your registrations | Handled by Dryft Global | Contractor self-reports |
| Foreign work permits | THB 2m capital and 4:1 ratio each | Within Dryft's entity, or LTR or SMART | Not available |
| Severance liability | Yours | Managed by Dryft Global | High if reclassified |
| Best fit | Large team, BOI project | First hires, tech and support teams | Short independent projects |
What an employee costs in Thailand
Thailand has one of the lowest statutory employer burdens in Asia for professional salaries, because Social Security stops at THB 17,500 a month. Customary benefits are the larger line. The model below is a Bangkok software engineer on THB 80,000 a month in 2026.
| Component | Employer share | Notes |
|---|---|---|
| Social Security | 5% to the cap | THB 875 a month maximum on the THB 17,500 ceiling |
| Workmen's Compensation | 0.2% to 1% | Employer only, annual premium, office class 0.2% |
| Employee Welfare Fund | 0.25% from 2027 | No wage cap; 0.5% from 2032 |
| Statutory subtotal | ~1.1% | Above THB 17,500 a month salaries |
| Year-end bonus | ~8.3% | One month, customary not statutory |
| Provident fund match | 3% to 5% | Voluntary, usually with vesting |
| Group health insurance | ~1.3% | Local plan; international plans cost more |
| Total employer on-cost | ~12% to 20% | Above base salary |
On the model salary, annual cost is about THB 1,111,000 against base pay of THB 960,000, a 15.7% burden before the EOR fee. Retirement severance of up to 400 days' pay is an unfunded liability worth providing for. Ask us for a cost model for your province and benefit tier.
Payroll and tax
Wages must be paid at least monthly, and monthly pay is standard for salaried staff. Two deadlines drive the month: PND 1 income tax withholding by the 7th (the 15th if e-filed, under an extension running to 31 January 2027) and Social Security by the 15th. New employees must be registered with Social Security within 30 days. At year end, issue 50 Tawi withholding certificates by 15 February and file the PND 1 Kor reconciliation by the end of February. From January 2027 the Employee Welfare Fund adds a monthly remittance.
Progressive tax with generous allowances
Personal income tax runs from 0% on the first THB 150,000 of net income to 35% above THB 5 million. Employees deduct 50% of employment income up to THB 100,000, a THB 60,000 personal allowance, their Social Security and provident fund contributions, and other allowances. Residents are also taxed on foreign income earned since 2024 when it is brought into Thailand. Highly skilled professionals on the Long-Term Resident visa pay a flat 17%.
Minimum wage by province
A tripartite Wage Committee sets daily minimum wages by province. Since 1 July 2025 the range is THB 337 to THB 400 a day, with THB 400 in Bangkok, Phuket, Chonburi, Rayong, Chachoengsao and Koh Samui, and nationwide for most hotels and entertainment venues. THB 400 a day is roughly THB 10,400 to 12,000 a month, so it rarely binds a professional hire, but it does matter for operations and hospitality roles.
Leave and mandatory benefits
- Annual leave. At least 6 working days after one year of service. Market practice for professional roles is 10 to 15 days. Unused leave is paid out on termination.
- Public holidays. At least 13 a year, chosen from the official list of 19 for 2026, including Songkran on 13 to 15 April. Holiday overtime is paid at three times the hourly wage.
- Sick leave. Up to 30 paid working days a year for actual sickness, with a medical certificate for three or more consecutive days.
- Maternity. 120 days since December 2025 (up from 98), with 60 days paid by the employer (up from 45) and a Social Security cash benefit for part of the rest.
- Spouse birth leave. New since December 2025: up to 15 days on full pay for an employee whose spouse gives birth, taken within 90 days.
- Infant care leave. New: up to 15 extra days at 50% pay where a newborn has a medical condition or disability.
- Personal business leave. At least 3 paid working days a year.
- Working time. 8 hours a day and 48 a week (42 for hazardous work). Overtime is paid at 1.5 times and needs the employee's consent.
- No 13th month. Not statutory, but a year-end bonus of about one month is customary and can become an implied term once paid consistently.
Termination and notice periods
There is no statutory probation period. Employees dismissed before 120 days of service receive no severance, which is why probation is commonly set at 119 days. Notice for indefinite contracts is given on or before a pay date and takes effect on the next pay date, never more than three months, and can be paid in lieu.
| Continuous service | Statutory severance |
|---|---|
| Less than 120 days | None |
| 120 days to less than 1 year | 30 days' pay |
| 1 to less than 3 years | 90 days' pay |
| 3 to less than 6 years | 180 days' pay |
| 6 to less than 10 years | 240 days' pay |
| 10 to less than 20 years | 300 days' pay |
| 20 years or more | 400 days' pay |
- Retirement is a termination. Severance is due on retirement, and an employee aged 60 or over with no agreed retirement age may retire on 30 days' notice and claim it.
- Summary dismissal is narrow. No severance only for listed causes such as dishonesty, wilful damage, three days' unexplained absence or a repeat rule breach after a written warning. State the reason at the time; you cannot add it later.
- Technology redundancy costs more. Replacing staff with machinery or technology needs 60 days' notice and adds 15 days' pay per year beyond six years, capped at 360 days.
- Unfair dismissal awards. The Labour Court commonly adds about one month per year of service on top of notice and severance.
- Late payment is expensive. Unpaid wages, notice pay and severance carry 15% annual interest.
Can I use independent contractors?
Only where the person delivers a result as a genuinely independent business: their own clients, their own schedule, their own tools, paid on completion rather than by the month. Thai law separates hire of services, which is employment, from hire of work, which is contracting, and courts decide on control, integration and who carries the risk. A full-time contractor embedded in your team is an employee whatever the paperwork says. Reclassification brings back overtime, leave and severance of up to 400 days' pay with 15% annual interest, plus Social Security arrears with a 2% monthly surcharge. Section 11/1 adds a further rule: a business that uses supplied workers for work forming part of its business is treated as their employer and must give them benefits no less favourable than its own staff. For anyone who works like an employee, an EOR is the compliant route.
The legal framework in brief
Thailand is a civil law jurisdiction with a national labour code and provincial minimum wages. The instruments you will hear most:
- Labour Protection Act B.E. 2541 (1998). Hours, overtime, leave, wage payment, notice, severance, work rules and the Section 11/1 supplied-labour rule. Amended by Act No. 9 in December 2025 for family leave.
- Social Security Act and Workmen's Compensation Act. Contributions, benefits and work injury cover, with the wage ceiling raised to THB 17,500 from January 2026.
- Revenue Code. Personal income tax, PND 1 withholding and corporate tax at 20%.
- Emergency Decree on Managing the Work of Foreigners (2017). Work permits, the restricted occupations list and employer penalties of THB 10,000 to 100,000 per worker.
- Foreign Business Act B.E. 2542. Limits foreign-majority companies providing services to third parties without a licence, BOI promotion or Treaty of Amity status.
- Personal Data Protection Act B.E. 2562. In force since June 2022, with cross-border transfer rules since March 2024 and fines up to THB 5 million.
- Immigration and right to work. A Non-B visa and work permit, with THB 2 million of capital and four Thai employees per foreign permit, or an LTR or SMART visa. The Destination Thailand Visa does not allow work for Thai companies.
- Authorities. Department of Labour Protection and Welfare, Social Security Office, Revenue Department, Department of Employment and the Board of Investment.
Where the talent is
About 65.8 million people, with unemployment around 1%, one of the lowest rates in the world, so good candidates have options and retention matters. Bangkok holds most headquarters, finance, technology and shared services roles. The Eastern Economic Corridor is the manufacturing and logistics belt. Chiang Mai has a growing technology and creative community, and Phuket a large hospitality base. English proficiency is uneven, stronger in Bangkok and in multinational and technology employers, so test it for client-facing roles. Thailand runs on Indochina Time, UTC+7, with no daylight saving.
| Region | Talent and industry concentration |
|---|---|
| Bangkok and vicinity | Regional headquarters, finance, technology, shared services and BPO |
| Eastern Economic Corridor (Chonburi, Rayong, Chachoengsao) | Automotive, EV, electronics, petrochemicals, logistics around Laem Chabang port |
| Chiang Mai | Software, creative and digital services, a lower cost base than Bangkok |
| Phuket and Koh Samui | Hospitality, tourism and property |
| Hat Yai and Songkhla | Southern commerce, trade and rubber processing |
Thailand Implementation Kit
This page tells you the rules. The kit tells you what to do, in what order, and what goes wrong when you skip a step.
- Step-by-step checklist, from route selection to first payroll
- Bilingual contract template and Thai work rules outline
- Social Security, PND 1 and Employee Welfare Fund calendar
- Provincial minimum wage lookup with the THB 400 sector rule
- Severance and notice calculator by length of service
- Work permit checklist: capital, 4:1 ratio, LTR and SMART routes
- Every official Thai authority with direct links
This guide is general information, not legal, tax or immigration advice. Provincial minimum wages, the Social Security wage ceiling, Employee Welfare Fund start dates and tax filing extensions change, and several were revised in 2025 and 2026. Confirm current figures with a qualified adviser or with Dryft. Last reviewed November 2026.
Ready to hire in Thailand?
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