Cost of firing staff cited as a 'burden'

Cost of firing staff cited as a 'burden'

Latest WEF report a mixed bag for nation

The high cost of severance pay given to employees is a financial burden on the business sector, according to the Office of the National Economic and Social Development Council (NESDB).

Tossaporn Sirisamphan, NESDB's secretary-general, said the issue was among the concerns raised at the World Economic Forum (WEF) last year.

Mr Tossaporn said that despite Thailand's improved labour competitiveness the cost of severance pay in the business sector is high compared with other countries.

According to labour laws, severance pay must amount to an average of 400 days of salary per 20 years of employment.

The WEF had also acknowledged the law and constitution have granted employees the right to stage a protest to protect their employment rights by establishing labour unions.

However, the number of unions and union memberships have continued to drop. In 2017, 1,365 labour unions were registered with 4.4 members between them. That represents a drop for the second year running.

Overall, there are positive factors that can buoy Thailand's labour competitiveness in the third quarter of this year. These include macroeconomic stability and more businesses adopting information and communications technology to aid productivity, Mr Tossaporn said.

The WEF recently launched its "Global Competitiveness Index: GCI 4.0" report on 140 countries.

For labour competitiveness, Thailand saw its ranking rise to 38 from 40 last year, placing it among the top three in Asean, after Singapore and Malaysia.

However, in terms of its commodity and labour markets, the country dropped from 38 to 44, trailing Singapore, Malaysia, the Philippines and Brunei in Asean.

Thailand ranked poorly in redundancy costs (128th), flexibility of wage determination (111th) and workers' rights (88th).

Meanwhile, the Department of Industrial Promotion is introducing a campaign to create more jobs for senior citizens in a project which includes soft loans for setting up small businesses as well as occupational training.

Department chief Kobchai Sungsitthisawad said the agency expects that by 2017 there will be more than 15 million people aged over 60 in the country.

However, many would like to continue working. Community development projects are being driven to develop their occupational skills in parallel with the Creative Industry Village programme initiated by the department.

Moreover, training will also be offered to those elderly who want to start their own businesses. They can then submit a business plan to apply for a soft loan not exceeding two million baht at a fixed interest rate of 4% per year. However, they must have an heir to guarantee the loan.

He said a pilot project has been launched in San Kamphaeng district in Chiang Mai with 1,857 senior participants who received training in various occupations, handicrafts being chief among them.

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