Things to Consider re Unfair Termination Cases

Introduction:

In this month’s article we shall examine key things that both employees and employers should be aware of regarding unfair termination/ dismissal cases. We shall examine this matter from the perspective of both the employer and the employee so that we provide a broad picture of issues and key points one should consider in relation to this kind of litigation.

Termination of an Employee – Practical Tips

If you are an employee and you have been terminated by your Company (with or without severance pay) we suggest that you don’t sign anything given to you by your employer regarding your termination until you have had it reviewed by your lawyers as such documentation may undermine or waive your legal rights. If you are aware that you are being terminated on a specific day we recommend that you have witnesses (preferably an independent witness) there to support and verify what occurs in any meetings/ discussions between you and your employer in case the matter goes to the labour court at a later date. If any emails or correspondence has been provided to you regarding your termination we suggest that you carefully retain copies of it as it may need to be relied upon in court at a later stage if the termination is contested as being unfair in litigation. Furthermore, if you have any proof regarding your performance at work such as appraisal reports or work awards then we suggest that you retain these as they may prove to be useful evidence in any case regarding unfair dismissal.

If you are an employer that is terminating staff due to poor performance or their breach of your company’s work rules/ regulations or a change in your Company’s corporate strategy or fiscal situation then we recommend that you retain solid evidence thereof in case such evidence is later to be relied on in court to justify why such termination was undertaken.

Engaging a Lawyer/ Law Firm:

If you are suing or being sued in the labour court in relation to an unfair termination case, then we recommend that the first thing you do is find an experienced and knowledgeable Thai lawyer who has expertise in handling this type of litigation. Before engaging a lawyer we recommend that you ask for a detailed service proposal so that it is clear from the beginning what the scope of exact services are, what the fees will be as well as how legal expenses will be charged. It is important that all of these details are agreed in advance as otherwise it can lead to misunderstandings and conflict later on. In some cases it may be possible to negotiate a lump sum fee with an attorney but if so we recommend that you clearly clarify if such fee is to cover the case at the first instance court as well as any appeals which may result. If litigation is to occur at a court that is far from your lawyers’ office then we suggest that the proposal also clearly mention the expenses related to travel costs particularly if flights and overnight stays in hotel accommodation are required.

In order to maximize the effectiveness of your meetings or consultations with your attorney(s), the writer suggests that you keep records of what is discussed at each meeting, who attended such meetings and that you have all necessary documents with you when meeting your lawyers. The writer thinks that if you engage a law firm to handle your case you ask for a designated contact person/ lawyer who you can directly liaise with as this will ensure that you have consistency in your dealings with the law firm and that you know exactly who you need to talk to if you have any questions or issues. Finally, if you have issues or questions for your lawyer we recommend that you put them in writing to your attorney and ask for a written response given that verbal responses can be difficult to rely on at a later date if your lawyer changes his opinion as to what he said.

The Labour Court Trial Process:

Filing Fees:

There are a number of key issues relating to the court process in the Thai Labour Courts that one should consider before becoming involved in unfair termination litigation. One of the most important issues is court filing fees in the Labour Court because section 27 of the Labour Courts Act (1979) (hereinafter referred to as the Act) provides that a plaintiff filing a case is not required to pay any court filing fees hence this can sometimes result in disgruntled employees sometimes seeking enormous damages claims from their former employer in unfair termination cases. Often an employee will make a claim for a large amount of damages in order to use it as a bargaining chip at the compromise stage of the court process.

Which Court to file the case?:

In relation to where an employee needs to file their claim for unfair dismissal, i.e. which Labour Court they must file their case, section 33 of the Act provides that labour cases must be filed with the labor court within the territorial jurisdiction where the ‘cause of action’ ¹ arose. For the purpose of this Section, the place of work of the employees is deemed as the place where the cause of action arose. However, if a plaintiff intends to file their lawsuit with a labor court in a different area because either they or the defendant live in another area, then the Labour Court may allow this if the plaintiff can prove that the trial in such other labor court will be convenient.

Stating Claim to Court:

The Labour Court, offers greater flexibility than other courts in terms of how a plaintiff can state his claim to the Court, indeed according to section 35 of the Act, the plaintiff can either file a written claim or state their claim orally to the Court. In the case of a Plaintiff giving their claim verbally to the Court, the Court has the right to investigate such claims (as it deems necessary in the interest of justice) and then make a written memorandum of such claim(s) and then have it read out to, and signed by the Plaintiff.

Mediated Compromise Stage:

The initial stage of an unfair termination case will involve both parties sitting down and the court trying to mediate a compromise between them. Before a compromise hearing occurs we recommend that both employers and employees should carefully consider using this stage to settle their dispute (if possible) as it can be cost effective and save considerable time as opposed to going through a trial and any appeals. We suggest that all parties prepare suitable offers and concessions for this mediation stage to show the curt that they have genuinely tried to resolve the case in an amicable manner.

What happens if a Party fails to attend the Court:

If after the case is filed with the Labour Court and an initial hearing date is fixed but one of the parties doesn’t turn up and doesn’t provide a reason for their non-attendance then the law provides as follows:

• In the case of a Plaintiff who fails to appear, the Court will determine that they has no intention to proceed with their case and as such the labor court shall then issue an order striking the case out of the case-list.
• If a defendant who has been issued with a summons to appear in court, fails to appear and doesn’t provide the labor court with a reason for this (such as illness etc), then the Court will issue an order declaring the defendant is in default and then continue to hear the case in their absence.

Legal Remedies – Unfair Dismissal Cases

In relation to unfair termination litigation, both employers and employees should be aware of the legal remedies that can be given by Labour Court, these are as follows:

According to section 49 of the Act, if the Court thinks that a dismissal/ termination of an employee is unfair, then it has the power to order the employer to reinstate the employee at the same level of wage at the time of their dismissal. However, if the labor court considers that such employee and employer cannot work together, it can order an award of compensation to be paid by the employer to the employee, taking into account various considerations including: the age of the employee, the working period of the employee, the employee’s hardship following their termination, the cause of their dismissal and the compensation the employee is entitled to receive under the law.

In the writer’s experience, he has often found that in cases where compensation is awarded by the court it is often set at one month’s salary for each year of employment with their employer, however, this is simply a rough guide given that each unfair dismissal case is different and the Court has broad discretion in terms of the amount of compensation it awards.

Judgment & Appeal

After all the necessary evidence has been taken, the trial will then be closed. The parties are permitted to close their respective cases by making a final oral argument on the day the trial is to conclude. Following the end of the trial, the labor court will then pronounce its judgment or order within three (3) days of that date. The judgment or order of the labor court must be made in writing and will state the facts of the case along with the decision of the Court on the issues as well as the grounds for the Court’s decision.

If a party to the case disagrees with the judgment in terms of a question of law (i.e. a legal issue such as the interpretation of a law etc) then it can be appealed to the Supreme Court (Labour Case Division) within fifteen (15) days from the date of the Labour Court’s pronouncement. The appeal to the Supreme Court must be lodged by filing a petition in writing with the labor court that gave the judgment or order. The labor court will then serve a copy of the petition to the other party (in the case) so that they have an opportunity to respond within seven (7) days from the date of receiving the appeal petition. If there is an answer from the other party or if they do not file an answer within the 7 day timeframe, the labor court will promptly forward the file of the case to the Supreme Court. The Supreme Court shall then consider the labor case and give its judgment on the appeal. In considering the case, the Supreme Court will rely on the facts established in the initial labor court case, however , if the facts are found to be insufficient, the Supreme Court will order that the labor court hear further facts relating to the case and then return the file to the Supreme Court so that it can continue hearing the appeal.

Dharmniti Law Office Co., Ltd.
2/2 Bhakdi Building 2nd Floor, Witthayu Road, Lumphini, Pathumwan, Bangkok 10330
Tel: (66) 2680 9777 Fax: (66) 2680 9711
Email: ryan@dlo.co.th or info@dlo.co.th