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By treating service charges hotel guests pay as income, hotels hope to get out of paying the new 300 baht minimum wage starting April 1st.

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Hotel association suggests wage fix

Service charges to be counted as wages
21/03/2012
Chadamas Chinmaneevong & Penchan Charoensuthipun

The Thailand Hotels Association (THA) believes service charges collected and distributed to workers should be considered wages, thereby reducing the burden of the new daily minimum wage.

The THA says it will support its members taking this stance if they are sued by employees or government agencies.

It cited a 1998 Supreme Court ruling that said service charges can be considered a part of salaries if they are booked as company income.

The THA also noted that contributions to the Social Security Fund are based on salaries plus service charges.

"Therefore, we are ready for a court fight if employees or the Labour Ministry bring a case," said Samphan Panphat, an adviser to the THA.

The Labour Protection and Welfare Department disagrees.

It believes it is illegal to combine service charges and salaries in calculating the total wage being paid to employees.

Deputy director-general Winai Luewirojn said his department must adhere to a 2007 Supreme Court ruling that said service charges are income collected from clients but not part of wages.

Hotels usually keeps 20-30% of the service charges received and share the rest with employees.

Apirat Autamarn, chairman of the Labour Federation of Hotel Businesses in Thailand, argued service charges are not hotel revenue but rather money clients give to the staff.

A five-star hotel will generally not touch this money but will divide it equally among employees.

"If the service charges are added into the salary, it means employees will get no benefit from the 300-baht wage policy. If this is true, we'll have to pin our hopes on the Labour Court," he said.

Vijit Dasanthud, chairman of the Labour Federation of Hotel Businesses and Services in Phuket, said the 300-baht daily minimum wage would help employees earn enough to cope with rising costs, especially in Phuket. 

"If the government allows this to happen, it means employers can distort the policy, and employees would gain nothing. If we look at the accounting, service charges are not considered business earnings," said Lae Dilokwitthayarat, an economics lecturer at Chulalongkorn University and an expert in labour affairs.

An employee of one well-known hotel in Bangkok said staff, especially at small and medium-sized establishments, want higher salaries because service charges are unpredictable.

The average base salary at five-star or other relatively expensive hotels is usually higher than the daily minimum wage.

The the human resources department at the source's hotel is re-evaluating the performances of existing employees and adjusting the base salaries.

"Actually, we don't know what our boss will decide. But whatever it is, we have little choice but to keep silent in order to keep our jobs," said the employee.

The source added that management appears to be waiting to hear what the government thinks about the issue.

Prakit Chinamourphong, the THA's president, said the new wage will certainly affect hotels, as they are heavily labour-dependent.

"Initially, most hotel management will fight by defining service charges as wages. Management will cite a letter from the Social Security Office stating that service charges are wages," as they are used to calculate social security contributions, said Mr Prakit.

A new daily minimum wage will take effect in seven provinces including Bangkok and Phuket on April 1.

(Source: Bangkok Post, Hotel association suggests wage fix, Service charges to be counted as wages, 21/03/2012, Chadamas Chinmaneevong & Penchan Charoensuthipun, link) 

Labour Conflict Vocabulary

wage - an amount of money that you earn for working, total income calculated by hours or days ค่าจ้าง
daily minimum wage - the smallest amount of money that can legally be paid to a worker for a day's work
salary - a fixed amount of money that you earn each month or year from your job เงินเดือน

charges - a payment that has to be made for something เงินที่เรียกเก็บ
service charges - an extra amount added to restaurant bills (such as 10%) to pay for the workers that serve the food (waiters, waitresses)

X counted as Y - X is included in the group of Y, X is treated as Y
X considered Y - X treated the same as Y
service charges to be counted as wages
service charges considered wages - same

fix - repair, change something so that it no longer causes you problems
wage fix - fix the min wage law (so that it no longer causes you problems)
hotel association suggests wage fix

distributed - made available to customers through stores and middlemen
burden - a responsibility, a difficult thing that must be done, a heavy load to carry ภาระ (See glossary)
reducing the burden
support - help สนับสนุน
stance - an attitude or view about an issue that you state clearly; position; your attitude, views or opinion about an issue จุดยืน ความเห็น

The Thailand Hotels Association (THA) believes service charges collected and distributed to workers should be considered wages, thereby reducing the burden of the new daily minimum wage. The THA says it will support its members taking this stance if they are sued by employees or government agencies.

cited - mentioned (to support a point you are making or arguing) กล่าวถึง
ruling - a decision by a court of law คำตัดสิน คำชี้ขาด
income - money that people receive from work or some other source, used for household consumption and savings
booked as company income - record as company income in the accounting system
contributions - the amount given by each member to the shared fund
contributions to the Social Security Fund

It cited a 1998 Supreme Court ruling that said service charges can be considered a part of salaries if they are booked as company income. The THA also noted that contributions to the Social Security Fund are based on salaries plus service charges. "Therefore, we are ready for a court fight if employees or the Labour Ministry bring a case," said Samphan Panphat, an adviser to the THA. The Labour Protection and Welfare Department disagrees.

illegal - against the law ผิดกฎหมาย, นอกกฎหมาย
clients - (formal) customer ลูกค้า
share - to have or use something at the same time as someone else ใช้ร่วมกัน
revenue - income from taxes or business activities รายได้
staff - workers, employees พนักงาน

It believes it is illegal to combine service charges and salaries in calculating the total wage being paid to employees. Deputy director-general Winai Luewirojn said his department must adhere to a 2007 Supreme Court ruling that said service charges are income collected from clients but not part of wages. Hotels usually keeps 20-30% of the service charges received and share the rest with employees. Apirat Autamarn, chairman of the Labour Federation of Hotel Businesses in Thailand, argued service charges are not hotel revenue but rather money clients give to the staff. A five-star hotel will generally not touch this money but will divide it equally among employees.

benefit - to get help or an advantage from something ผลประโยชน์
policy - a plan of action to guide decisions and achieve outcomes (See Wikipedia) นโยบาย
pin our hopes on - to put all your hope on one thing to help you
cope - to deal successfully with a difficult situation; continue to operate and function despite problems รับมือกับ รับมือ (See glossary)

"If the service charges are added into the salary, it means employees will get no benefit from the 300-baht wage policy. If this is true, we'll have to pin our hopes on the Labour Court," he said. Vijit Dasanthud, chairman of the Labour Federation of Hotel Businesses and Services in Phuket, said the 300-baht daily minimum wage would help employees earn enough to cope with rising costs, especially in Phuket. 

employers - companies that hire workers
distort - describe in a false and untrue way, not the way it should be
accounting - the work of keeping and checking financial records for a company or organization
labour affairs - problems having to do with workers at companies (wages, benefits, working conditions)

"If the government allows this to happen, it means employers can distort the policy, and employees would gain nothing. If we look at the accounting, service charges are not considered business earnings," said Lae Dilokwitthayarat, an economics lecturer at Chulalongkorn University and an expert in labour affairs.

employee - someone who is paid regularly to work for a person or an organisation ลูกจ้าง
unpredictable - do not know what is going to happen next ที่ไม่สามารถคาดเดาได้
base salary - the salary before other extra income is added such as "travel allowance"

An employee of one well-known hotel in Bangkok said staff, especially at small and medium-sized establishments, want higher salaries because service charges are unpredictable. The average base salary at five-star or other relatively expensive hotels is usually higher than the daily minimum wage.

resources - the materials, money, and other things needed for a person or organisation to function properly ทรัพยากร
human resources - the employees of a company (together with all their knowledge and skill)
human resources department - the HR department, the department in a company that takes care of employee-related issues (training, benefits, hiring, etc)
evaluating - thinking carefully about something before making a judgment about its value, importance or quality
re-evaluating - evaluating again, looking at something again
source - someone who gives information to the media แหล่งข่าว
we have little choice but to - we must, we have to, we are being forced to
issue - a problem that needs to be considered adn discussed ประเด็น

The the human resources department at the source's hotel is re-evaluating the performances of existing employees and adjusting the base salaries. "Actually, we don't know what our boss will decide. But whatever it is, we have little choice but to keep silent in order to keep our jobs," said the employee. The source added that management appears to be waiting to hear what the government thinks about the issue.

dependent - using, needing the support of something to continue existing ต้องอาศัย
labour-dependent - using labour, needing labour
heavily-labour dependent - using lots of labour, needing lots of labour 

Prakit Chinamourphong, the THA's president, said the new wage will certainly affect hotels, as they are heavily labour-dependent.

cite - to mention something as an example กล่าวถึง
calculate - to discover a number or amount using mathematics คำนวน
security - the activity of making safe or protecting from harm
social security - a social insurance program providing social protection or protection against socially recognized conditions, including poverty, old age, disability, unemployment and others (See Wikipedia)
social security contributions - money that workers and their employers pay into social security to receive the "social insurance" , if something goes wrong such as losing their job then they get money from social security  

"Initially, most hotel management will fight by defining service charges as wages. Management will cite a letter from the Social Security Office stating that service charges are wages," as they are used to calculate social security contributions, said Mr Prakit. A new daily minimum wage will take effect in seven provinces including Bangkok and Phuket on April 1.

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