Foreign Employment in Thailand: 2021 Guide to Work Permit Exemptions

The Kingdom of Thailand is Southeast Asia’s second-largest economy with its Top 3 Fast-Growing Industries in e-Commerce, automotive and manufacturing, and infrastructure.

The Kingdom of Thailand is Southeast Asia’s second-largest economy with its Top 3 Fast-Growing Industries in e-Commerce, automotive and manufacturing, and infrastructure.

According to information from Harvey Law Group, an international law firm specializing in corporate immigration for founders and investors, Thailand is becoming increasingly attractive as a place for foreign companies to get work permits and set up businesses in Southeast Asia.

In 2019, Thailand’s exports and major investment projects have been progressively increasing, particularly in the infrastructure sector. Public and private investment is also increasing in the government’s megaprojects, such as those in the East Economic Corridor (EEC) investment zone, covering three provinces of Rayong, Chonburi, and Chachoengsao. This is also where the government is trying to attract foreign direct investments.For this reason, many foreign employees and contractors might be looking to work in Thailand in the near future. Here are some of its policies to help you understand the Thai labor laws for foreigners.

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A brief history of work permits in Thailand for foreign employees

Before the Foreign Business Act of 1999, B.E. 2542 (1999), there was an Alien Business Act of 1972, ratified by a military junta. During that period, foreign investments were heavily restricted to the extent that if a Thai, who is holding onto foreign shares, was caught, would be severely punished by the law.

Fortunately, the Foreign Business Act was introduced in 1999 and opened up the economy. The act divided the economy into three sectors according to the extent of restrictions in each industry. The list also included important information about the amount of foreign ownership and capital requirements for doing business in the Kingdom.

With that, if you are planning to start your business in 2021, there are a few important points to take note of regarding work permit exemptions and employment laws in Thailand.

Also read: Doing Business in Thailand - Complete Guide 2020

How do I apply for a work permit in Thailand?

Before we jump into the exemption, let us first address the application for a Thai work permit. Here are the steps to apply for it.

The employee should enter into Thailand with a non-immigrant business visa and a prospective employer (the following steps should be completed by your employer before the employee enters into the country.) Once the employee has entered, the employer/foreigner is to apply for their work permit within 30 days.

Employers are to submit the following documents* for the application for the work permit at the Alien Occupational Control Division.

  1. Application form signed by the employee
  2. Letter of engagement/employment from the company
  3. Company Affidavit/Certificate of Incorporation
  4. Audit report, balance sheet for three preceding years
  5. Employee’s personal income tax declaration form or withholding tax form
  6. A written report stating the employee’s activities and a declaration that the activities comply with the conditions stipulated in the work permit booklet
  7. Map of the location of the company signed by the authorized Director
  8. Copy of the foreign employee’s passport and the valid non-immigrant visa stamp
  9. Health certificate from a certified Thai doctor and syphilis test
  10. Three color photographs of the employee
  11. Certified copies of the employee’s educational certificates and qualifications for the job.

*Adapted from the ASEAN briefing

Is there a maximum number of foreign employees per company?

A company in Thailand can hire one foreign worker per 3 million Thai baht in capital and one foreign worker per four full-time Thai employees.

In other situations like joint ventures where Thai shareholders hold a majority interest, the ratio is one foreign worker per 2 million Thai baht in capital and one such foreign worker per four full-time Thai employees.

However, the total number can’t exceed 10 foreign workers unless the company has a Foreign Business License (FBL) or is approved by the Board of Investments (BOI).

Specifically, this ratio is not applicable to:

  • BOI-registered companies
  • representative offices
  • regional offices
  • branch offices
  • legal entities under the allowed business scope of the Foreign Business Act BE 2542 (1999) (i.e., the representative office, regional office, and branch office), in which case the ratio may be relaxed depending on the type of business conducted in Thailand.

Furthermore, under Immigration Police Order No. 777/2551 dated 25 November BE 2551 (2008), there is no quota requirement or restriction on foreign workers and volunteers working for non-governmental organizations (NGOs) in Thailand. Hence, an NGO is entitled to employ foreign workers and volunteers without employing a corresponding ratio of Thai employees.

Which foreign employees don’t need work permits?

According to the Royal Decree on Management of Alien Workers BE 2561 of 2018, foreign nationals working in Thailand are not required to apply for work permits if they work in one of these categories:

  • International diplomats or government representatives
  • Short-term activities or urgent and essential nature
  • Founders or investors
  • Investment promotion

International diplomats or government representatives

This category includes:

  • Members of diplomatic or consular missions
  • Representatives of the United Nations and other specialized agencies
  • Personal assistants to diplomatic missions

This also includes people conducting work on behalf of a foreign government or organization, specifically:

  • People performing duties or missions under an agreement by Thailand’s national government with a foreign government or international organization
  • Performing duties or missions for educational, cultural, artistic, sports, or other purposes as prescribed in a ministerial regulation

Short-term, urgent, and essential work

Under the Royal Decree, business visitors doing short-term, necessary, and urgent work for no more than 15 days don’t need to get a work permit. However, they must file a notification letter to the Ministry of Labor before entering the country and after being in the country for 15 days.

This includes urgent works taking place without notice, such as:

  • Conferences
  • Petroleum-related technical work
  • Machine repairs or installation work
  • Other areas of work under the consideration of the Director-General of the Department of Employment.

Also, foreigners doing short-term educational or cultural activities related to their professions also don’t need to get work permits. This includes:

  • Organizing or attending a meeting, conference, public speaking event, lecture, training, workshop or seminar
  • Performing artistic and cultural activities or participating in sports competition or activities prescribed by the Council of Ministers

Do note that the terms “urgent and essential nature” are not defined explicitly. As such, the issuance of the work permit on this basis is up to the discretion of the administrative office.

Founders or investors

Under specific cases, foreigners planning to establish a business or investment are also exempt from work permit requirements. This includes:

  • establishing a business or investment or possessing knowledge, ability or high-level skills beneficial to Thailand, as prescribed by the Council of Ministers; and
  • representing a foreign juristic person licensed to operate a business under the foreign business law (i.e., the director of a foreign licensed juristic person, representative office managers, or branch office managers).

What’s the conclusion?

Thailand has long been a major hub of foreign investment in Southeast Asia, with several policies already in place to accommodate foreign companies. This makes it a viable next step or even headquarters to expand your business across Southeast Asia.

However, applying for work permits in countries like Thailand and Vietnam can still be a long and complicated process — especially if you’re also planning the first steps of your business in a new country.

To sum up, we have covered how to apply for a general work permit and answered some frequently asked questions regarding work permit exemptions. Do also read Greenhouse’s Complete Guide to Doing Business in Thailand to find out the details of business structures and regulations to help you incorporate your business with ease.

You can start by contacting a law firm or service provider to help assess your needs and figure out the best option for you.

Want to expand your business to Thailand?

Greenhouse will help you connect with pre-qualified service providers who will help with work permits application suited to your specific business needs in Thailand.

We’ll also connect you with experienced consultants on the ground who can help answer your questions about incorporating your business in Thailand

Information credit to Harvey Law Group, 2019.

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