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Why Ending an Unfair Dismissal Dispute with Mediation Is More Convenient
Facing an unfair dismissal dispute in Thailand can be difficult for employers and employees alike. There are reputational and financial risks and exposures to consider, among the many other factors when an employee claims wrongful termination. And getting lawyers and courts involved can often complicate things, and there is a risk that the outcome ordered by the court is unsatisfactory for all parties involved.
Business mediation is an alternate dispute resolution option that offers a quicker, more convenient route to settling an employment termination disagreement without finding yourself in a lengthy, and most likely costly, legal battle.
What is unfair dismissal in Thailand?
In Thailand, the Labor Protection Act (LPA) establishes and governs the rights and responsibilities of employers and employees. This includes how and under what conditions an employer can terminate and employee. Generally, this would be dismissal with cause or without cause.
Dismissal without cause, or terminating without reason, is allowable as long as the employer gives a required notice period and pays severance if the employee qualifies. Dismissal with cause refers to cases when an employee commits specific violations outlined in the LPA. This includes such acts as causing damage to the employer on purpose, conducting criminal activities against the employer, missing three working days or more in a row without just cause or notification, or violating work rules published and circulated by the employer after fair warning. Dismissals with cause do not require prior notice or severance.
An employee could claim unfair dismissal if the conditions for their termination did not meet the requirements under the LPA. Examples of grounds for unfair or wrongful dismissal include:
- dismissal without cause without full severance or proper notice as prescribed by the LPA, or
- dismissal with cause for work violations without proper warnings as outlined in official employer work rules and the LPA.
What are the issues in an unfair dismissal claim?
Terminating an employee is unfortunate, but it does happen. Nevertheless, an employee may feel that their termination is unfair, and in some cases, they may wish to challenge it. There may be disagreements as to the calculation of severance pay. Because although Thai law establishes rates of severance based on length of employment, there may be disagreements over how to determine what “wages” should include. Is it just their monthly salary, or must it include allowances such as for travel or cash incentives? The law is unclear, so disputes would need to be adjudicated. Regarding dismissals without cause, a fired employee may contest whether their actions qualify for immediate termination or whether they received adequate warning. Again, written laws and regulations offer some guidance, but for some circumstances, such as with warnings, there may be room for questions. And disputes can arise even if an employment contract is in place.
Why would business mediation be a better alternative to court?
Thailand does have a dedicated Labor Court that oversees employment disputes such as wrongful terminations. However, employers may want to avoid court because Thailand’s labor laws are known to be more employee-friendly than other jurisdictions so that they may end up with unexpected fines and costs, and employees may want to avoid it because the cost of going to court may be more than they can handle. Unwanted financial exposures aside, there may also be reputational risks for all parties during testimony and evidence in a court proceeding.
Opting for a mediation between employer and employee offers a potentially better solution for all. Business mediation overall has its advantages to going to court. It is more informal, so you can select a venue as well as scheduling for your convenience. You do not have to feel constrained by the court’s location or timetable. Mediation is generally less costly from proceeding fees to retainers for lawyers or other advisors, and often it can settle disputes faster than court. More importantly, everything discussed and disclosed during mediation is confidential, unlike public court proceedings. So, you can have a more open and honest discussion as you negotiate a settlement. And if you still cannot settle things, you can resort to court.
THAC is an ideal mediator for your unfair dismissal dispute
Engaging in business mediation for your unfair dismissal dispute at the Thailand Arbitration Center (THAC) has an additional benefit in that, under Thai law, any settlement drawn up and agreed upon through a THAC mediation has the weight of an arbitral award. This means that if one party violates or breaches the agreement, the other party can sue in court. The THAC is a well-established institution offering alternate dispute resolutions services. Our mediators have received training at the highest international standards, so that we can mediate unfair dismissal claims between employers and employees from local to multinational entities skillfully and impartially.
THAILAND ARBITRATION CENTER (THAC)
The Thailand Arbitration Center (THAC) is an institution that provides alternative dispute resolution services, comprising of arbitration and mediation, for cross-border disputes. It is established by the Act of Arbitration Center B.E. 2550 (2007). The THAC was first founded and commenced its operation in 2015, intending to promote and strengthen the alternative dispute resolution system and services in Thailand.
The Thailand Arbitration Center is located in the heart of Bangkok, one of the most international and vibrant cities in South-East Asia. The THAC is easily accessible with its convenient locale in the vicinity of international airports. It offers high-standard ADR services, affordable administration fees, and state-of-the-art facilities for in-person and remote hearings (https://thac.or.th/rooms/).
The latest service introduced by the THAC is the Online Dispute Resolution (ODR) platform for arbitration mediation and negotiation, called “TalkDD” (https://odr.thac.or.th/auth/login). This innovative service is easy to use, it can be accessed by laptops, smartphones, and tablets with a simple login system.
For further information, please feel free to contact us at [email protected] or +66 (0)2018 1615. THAC is looking forward to helping you.
