What an employee really costs in Thailand
Gross salary is roughly 85% of the story. This adds the statutory employer contributions, the customary costs, and the severance liability accruing from day one.
The role
Figures in Thai Baht, per month unless stated. Nothing you enter leaves your browser.
Base salary plus any fixed, regular allowance paid as remuneration for work. Fixed monthly allowances without a documented welfare purpose generally count as wages.
Daily-paid staff have no monthly salary to budget from, so the daily wage is scaled by the days actually rostered.
Voluntary, not statutory. 3–5% is typical.
0.2%–1.0% by industry risk. Wage base capped at ฿240,000 a year.
Customary, not required by law.
Drives the severance accrual below.
The severance accrual is the number most budgets miss. It is a real, growing liability that never appears on a monthly payroll report, and it falls due in a single payment exactly when a restructuring is already expensive.
Using an outsourcing company does not move the liability away from you. Section 11/1 of the Labour Protection Act deems a business operator a co-employer of the workers a contractor supplies, and requires the same benefits and welfare as your own staff doing comparable work. The Supreme Court has enforced it, and non-compliance carries a fine up to ฿100,000.
Why the accrual matters
Severance is not insured, not funded and not shown on a monthly payroll report — yet it grows every month and falls due in one payment, usually at the exact moment a restructuring is already expensive. A team of twenty on ฿80,000 with five years' average service carries roughly ฿9.6 million of unfunded liability. Most finance teams have never seen the number.
Plan notice and severance from actual datesWhat the law actually requires
| Cost | Rate |
|---|---|
| Social security — employer share | 5% of wages, capped at ฿17,500/month |
| Workmen's compensation fund | 0.2%–1.0% of wages, capped at ฿240,000/year |
| Provident fund | Voluntary |
| Annual bonus | Customary |
| Statutory severance | 30 to 400 days' wages by service |
The social security ceiling rose from ฿15,000 to ฿17,500 on 1 January 2026, and is scheduled to reach ฿20,000 in 2029 and ฿23,000 in 2032.
Overtime and holiday work sit on top of these figures, at 1.5, 2 or 3 times the hourly rate depending on the day and the wage basis.
What overtime addsTotal annual employer cost
฿1,098,980
That is 1.14× base salary, or ฿91,582 a month.
Severance accrued, unfunded
฿480,000
180 days' wages after 3 years. Payable in full if you make the role redundant — and nothing in Thai law requires you to fund it in advance.
Frequently asked questions
Two contributions are compulsory. Social security at 5% of wages, capped at a wage base of ฿17,500 a month — so ฿875 per employee per month, ฿10,500 a year, with the employee paying the same again from their side. And the workmen's compensation fund at 0.2% to 1.0% of annual wages depending on industry risk, on a wage base capped at ฿240,000 a year. Everything else — provident fund, annual bonus, health insurance, allowances — is customary or contractual rather than required by law, but leaving it out will cost you candidates.
No. Thai law requires no annual bonus at all. It is a widespread custom, particularly among larger employers and multinationals, and once you have paid it consistently it can become an implied contractual term that is difficult to withdraw. Treat it as a real cost when budgeting, but state clearly in the contract whether it is guaranteed or discretionary.
Because it is one, and it is the cost that surprises people. Statutory severance accrues from the employee's 120th day and grows with service — 30 days' wages, then 90, 180, 240, 300 and 400. Nothing in Thai law requires you to fund it in advance, so it never appears on a monthly payroll report, and it falls due as a single payment at exactly the moment a restructuring is already expensive.
Yes, and it recently did. The wage base rose from ฿15,000 to ฿17,500 on 1 January 2026, taking the maximum monthly employer contribution from ฿750 to ฿875. It is scheduled to rise again to ฿20,000 in 2029 and ฿23,000 in 2032, so any budget running past 2028 should assume it moves.
Visa and work permit government fees, renewed annually, plus 90-day reporting and the administrative time around both. The figure in this calculator is indicative — actual fees vary by visa type, duration, and whether the employer is BOI-promoted. The cost that catches companies out is not the fee: BOI-promoted companies face Thai-to-foreign headcount ratios, so hiring one foreign specialist can oblige you to hire several Thai employees alongside.
Yes — through an Employer of Record. JST becomes the legal employer: we hold the contract, run payroll, make the statutory contributions and handle work permits, while the person does their day job for you. It is the usual route for testing a market, hiring one or two people, or bridging the months while an entity is being incorporated.
Sources
- Social Security Office — contribution rates and wage ceiling
- Labour Protection Act (No. 7) B.E. 2562 — Royal Gazette
This calculator provides a general estimate of employer costs in Thailand. It is not legal, tax or accounting advice and cannot account for your employment contracts, work rules, collective agreements or BOI conditions. Figures for voluntary and customary costs depend on your own policy. Take advice before relying on these numbers for a budget or an offer.
Want the number for your actual roles?
Send us the positions you are planning and we will come back with a fully costed picture — including the severance liability you will carry, and what an Employer of Record arrangement would cost instead.