Thailand recently issued regulations to implement the Employee Welfare Fund (“EWF”), which is intended to provide financial support to employees on employment termination or death. The regulations require employers and employees to start making contributions to the EWF from 1 October 2025. Employers can be exempted from contributing to the EWF if they offer a qualifying provident fund or comparable assistance, which may be an incentive to establish a provident fund if they have not already done so and review the design and participation requirements of their existing provident fund to evaluate exemption qualification.
Background
The EWF was established in 1998 under the Labor Protection Act B.E. 2541 (1998) (“LPA”) but has never been implemented since its introduction. After a delay of more than two decades, Thailand recently enacted a Royal Decree and other regulations to finally implement the EWF, which will be administered by the Department of Labor Protection and Welfare.
Key details
The most relevant details for employers to note include the following:
Requirement to register employees with the EWF
All employers with at least ten employees as of 1 October 2025 are required to register employees with the EWF and make contributions if they do not provide a provident fund or comparable assistance to employees for employment termination or death.
Provident funds: Defined contribution funds registered with the Securities and Exchange Commission under the Provident Fund Act B.E. 2530 (1987). These usually have matching employer and employee contributions, with each contributing from 2% to 15% of an employee’s wages. However, provident fund contributions provide significant tax benefits for both employers and employees, whereas no tax benefits have been announced for EWF contributions. Employers may set eligibility requirements and exclude certain employees, such as those on probation, from participating in the fund.
Whilst the LPA does not specifically address the scenario where an employer has established a provident fund but excludes certain employees from participating under the fund’s rules, it is likely that these employees must be registered with the EWF as the provident fund has not been provided to them.
Comparable assistance: An employer provides comparable assistance by setting up a benefits program with an individual bank savings account for each employee, to which both employee and employer contribute at least 2% each of an employee’s wages. The funds may be withdrawn by the employee on termination for any reason or by designated beneficiaries in the event of death. More details, including requirements for the benefits program rules, can be found in the relevant Ministerial Notification here (opens a new window).
The following employers are exempt from participating in the EWF:
Employers with fewer than 10 employees.
Employers who provide all employees with a provident fund or comparable assistance.
Employers in specific businesses exempted from EWF provisions in the LPA, such as private schools, non-profit organizations, agriculture and sea fisheries.
Contribution rates for both employers and employees
For employees registered in the EWF, from 1 October 2025 to 30 September 2030, both the employer and employee are each required to contribute 0.25% of the employee’s wages to the EWF. From 1 October 2030, this will increase to 0.50% of wages for both employer and employee.
The employer must withhold the employee’s required contributions from their monthly wages. The employer must then pay both the employee’s and employer’s contributions and submit an employee list form (opens a new window) as a record of contributions to the Provincial Office of Labor Protection and Welfare (for employers outside Bangkok) or the Bangkok Office of Labor Protection and Welfare (for employers in Bangkok) (the “Office”) by the 15th of the following month.
If an employer fails to pay the total contributions in full on time, an additional amount of 5% per month on accumulated unpaid amounts will be payable. Employers who fail to submit the employee list form, do not notify the Office of changes to the employee list form by the 15th of the month following the month in which the change occurred or provide false information may be subject to imprisonment for up to six months, a fine of up to THB 10,000, or both.
Payment to employees or beneficiaries
EWF contributions and any accrued interest shall be paid by the EWF to an employee on termination of employment for any reason or to designated beneficiaries in the event of death.
The LPA and regulations only currently provide for payment on employment termination or death, but the LPA sets out that the EWF may also be used to provide financial support for any other circumstance that may be prescribed by the EWF Committee in the future.
Employers should evaluate the impact of the change on their total rewards and benefits strategy as they determine whether they will comply through participation in the EWF or seek exemption by offering a provident fund or comparable assistance to employees. Each approach has different contribution rate requirements, tax treatment, investment return opportunity, and financial and administrative costs, among other factors. Your Lockton Consultant is available to discuss the potential impact of the change on the retirement benefits, financial planning, and financial education currently offered to your employees.
Generally, employers with at least 10 employees and that do not currently offer a provident fund or comparable assistance will be required to participate in the EWF unless they choose to set up these benefits prior to 1 October 2025. Employers who have established a provident fund or provide similar benefits will need to start reviewing these benefits carefully to determine whether they are exempted from participating in the EWF.
Employers who will participate in the EWF will need to establish internal procedures to comply with the regulations, including administrative processes to register employees with the EWF and maintain accurate records. They will also need to update payroll systems.
Employers should monitor the release of additional regulations and regulatory guidance (expected before the EWF is implemented in October 2025) as they develop their approach to comply with the requirement.
Further information
