M&A Monthly Report : September 2017

Revised Labor Protection Act

Ministry of Labor has proposed to the Cabinet to make another revision of the Labor Protection Act and the draft was approved by the Cabinet on 15th August 2017. The important amendments of Labor Protection Act are as follows:

1. Adding the definition of “remuneration” into Section 5. The remuneration shall mean money paid to employee by employer in return for works and which is apart from wage, overtime pay, holiday pay, and holiday overtime pay. Such remuneration shall be paid at least once a month.

2. Requiring payment of interest rate at 15% per year on any overdue payment in lieu of advance notice, overdue payment of remuneration, and overdue wage payment during temporary business closure.

3. Requiring employee’s consent in order to change employer and all rights and duties relating to employee shall be transferred to new employer.

4. Specifying the period of wage payment in lieu of advance notice for termination of employment contract. If there is no specification of the payment, employee must claim to employer and the interest for overdue payment shall be applied.

5. Specifying the number of business leave of not less than 3 days per year and employer shall pay wage for such leave.

6. Extending the scope of maternity leave to cover the leave for pregnancy check-up which employer shall pay wage to a female employee for such leave.

7. Requiring employer to equally determine the gender pay rates of wage, remuneration, overtime pay, holiday pay, and overtime holiday pay for the same quality, quantity, or value of work.

8. Specifying location and due date of the payment during temporary business closure.

9. Increasing severance pay rate for employee who has worked for more than 20 years to receive the payment of not less than the last rate of wage for 400 days.

10.  Determining the period of office relocation in case that the new office or the relocated place has already been established, employer must inform to employee about the relocation schedule in advance in the form as prescribed by the Director-General.

11.  Specifying payment period of a special severance pay or a special severance pay in lieu of advance notice to an employee by starting from the date of termination of employment’s contract.

12.  Allowing the settlement of employer’s criminal offence relating to Labor Law in case that employer complies with Labor’s order or court judgment regarding office relocation and employee’ complaints.

13.  Revising the criminal penalty provisions and criteria under Labor Protection Law.

 

This draft of amended Labor Protection Act will be passed to the relevant authorities and the National Legislative Assembly for consideration before an official enactment.

Additional promotions for Robotics and automatic system technologies industries

On August 29th, 2017, the Cabinet has approved development measure to support the robotics industries and automatic system technologies to keep up with the Thailand 4.0 policy.  The measures aim to encourage the manufacturing and service industries to increase productivity through the use of robotics and automation systems. Therefore, the government has issued measure and privileges to support these businesses such as

 

1) BOI will give 1.1) 50% deduction on corporate income tax relating to the robotic and automation operations used to improve manufacturing and service efficiency, 1.2) maximum BOI privileges to system integrators (SI)

 

2) The Ministry of Finance (MOF) will give 2.1) exemption of corporate income tax by 300% to support research on robotics and automation systems and 2.2) exemption of import duty for parts and equipment for making robots and automation systems

 

3) The Industry Ministry will be launching a low-interest loan program for SMES that adopt such technology to improve their productivity. 

 

4) The government will also establish the Center of Robotic Excellence (CoRE) to the human resources development and upgrades of robotic and automation system technologies.

 

At this stage, the Cabinet has only approved the promotion in principle, the detail of each promotion shall  be announced by each concerned government office.