Employment outsourcing and sub-contracting
in Thailand
ForeignCo is a foreign company that has arranged for certain of its products to be manufactured under license in Thailand by a Thai company, ThaiCo. It wishes to station several foreign technicians in Thailand and to recruit some Thai employees to supervise the manufacturing process and to ensure quality control. ThaiCo has only limited paid up capital. How can these arrangements be structured to comply with Thai law, and to reduce ForeignCo’s legal and tax liabilities? Would usage of a Thai recruitment agency in the contracting arrangements help? Can a fixed term contract be entered into with employees? Can the arrangement be structured as one of hirer/independent contractor rather than employer/employee? In a subcontracting situation, does the principal or the subcontractor have the statutory obligations of an employer?