NEWS

Legal Insight / Announcement of Bangkok Metropolitan and Labor Law

This is the translation of “บทความกรณีประกาศกรุงเทพกับกฎหมายแรงงาน” posted on 2020.04.01

 

Due to Announcement of Bangkok Metropolitan Administration (hereinafter referred to as “BMA”) (No. 2) ordering temporary closure of premises in the Bangkok area covering 26 business categorizes i.e. shopping malls (except supermarket zones and drugstores), restaurants (only takeaway is permitted), beauty salons and barber shops, spas, massage shops, and entertainment venues, etc. from 22 March to 12 April 2020 in order to decrease the possible spread of coronavirus disease (COVID-19).

 

Then, there comes a significant issue that whether an employee of those business receives wage or not, because they stop working during the period mentioned in the Announcement.

 

Section 75 of Labor Protection Act, B.E. 2541 (1998) states that “Where it is necessary for an employer to temporarily cease his/her business operation, wholly or partly, for whatever cause of significance, but not a force majeure, affecting his/her business activities to the extent that the employer is unable to carry on his/her normal operation, the employer shall pay wages to an employee in the amount of not less than seventy-five per cent of wages for a working day that the employee was receiving before the cessation of business operation for the entire period in which the employer does not require the employee to work…”.

In this case, an employer necessarily stops his/her business operation temporarily because of the order of temporary closure of premises by BMA. Therefore, it is not in consistent with Section 75 of Labor Protection Act, B.E. 2541 (1998) as an employer must obey BMA’s order, by ceasing his/her business operation temporarily, which is considered a force majeure beyond the employers’ control and anticipation.

In addition, Section 8 of Civil and Commercial Code defines “Force majeure” as “any event the happening or pernicious result of which could not be prevented even though a person against whom it happened or threatened to happen were to take such appropriate care as might be expected from him in his situation and in such condition”.

 

In this circumstance, as the BMA’s order of temporary closure of premises is considered force majeure which excuses the employer from debt of payment, the employer doesn’t have to pay wages to the employee at all. This circumstance is comparable to the example:  the court judges that the Ministry of Finance order’ to close down the defendant’s business results the company to be relieved from repayment because it is beyond the company’s control and is not responsible for such non-performance.

 

The detail is shown in the judgment of the Supreme Court No. 4968-5050/2543 that “the defendant has a debt in a form of shares that 83 plaintiffs left in the day of dismissal to be issued. However, the fact is that the Ministry of Finance had issued an order to close down the defendant’s business. As a consequence, the defendant was unable to do any transaction as normal and had to dismiss all the employee including all the 83 plaintiffs. In the dismissal date, the defendant had no power to issue the plaintiffs’ remaining shares. So that, the defendant became unable to repay such debt after it had been caused. Plus, Section 219, paragraph 2, of Civil and Commercial Code states that “if the debtor, after the creation of the obligation, becomes unable to perform, it is equivalent to a circumstance rendering the performance impossible.”

When the repayment was impossible because the defendant was restrained from doing any transaction by the Ministry of Finance. The defendant, therefore, was relieved from obligation to perform in consistent with Section 219, paragraph 1, of Civil and Commercial Code. Absolutely, the defendant must not pay for the shares, cost of damage, as well as the interest to the plaintiffs.

 

 

This is in contrast with the case that an employee of business which is excluded from the BMA’s Order to be temporarily closed, but an employer, by his/her own decision, order an employee to temporarily stop operation in order to decrease possible transmission of COVID-19, or the owner of the premises where the employer’s rented workplace is located in temporarily closes the premise without the order from the Government agency. This case is considered the employer decides to temporarily stop his/her business operation for cause of significance affecting his/her business activities to the extent that the employer is unable to carry on his/her normal operation, but not a force majeure to temporarily cease their business, wholly or partly.

Therefore, if the employer orders an employee to temporarily stop their normal operations, or the owner of the premise where the employer’s rented workplace is located in temporarily close the premise when there is yet confirmed infection in that place, the employers’ order is not considered a forced majeure and is in consistent with Section 75 of Labor Protection Act, B.E. 2541 (1998). The employer shall pay wages to an employee in the amount of not less than seventy-five per cent of wages for a working day that the employee was receiving before the cessation of business operation for the entire period in which the employer does not require the employee to work.

 

However, in the case that an employee of business which is excluded from the BMA’s Order to be temporarily closed, but an employer, by his/her own decision, orders an employee to temporarily stop the operation because there is confirmed COVID-19 infection in the workplace, the cause of the employer’s order is considered a forced majeure beyond an employer’s control or anticipation which affects his/her business activities to the extent that the employer is unable to carry on his/her normal operation. Therefore, the employer must not pay wages as well as the money in the amount of not less than seventy-five per cent of wages for a working day that the employee was receiving before the cessation of business operation for the entire period in which the employer does not require the employee to work. The employer shall pay seventy-five percent of wage only for the cause that is not forced majeure.

 

Also, both cases above are given cautions: during a workplace is temporarily closed whether by BMA’s order or by the employer’s decision, if an employer requires an employee to continue performing any task i.e. connecting customers, managing documents, and any other tasks and the employee operates such tasks as ordered at all time after the workplace is closed, whether the employee doing the task at his/her residence or where else relieved from temporarily closure as denoted in Section 75, it is considered the employee operates work for the employer. The employee shall receive wages for a working day for the entire period in which the employer requires the employee to work, not to mention where an employee doing his task. The employer does not have to pay another money in the amount of seventy-five percent of according to Section 75.

 

We do hope this article will be useful to you for better understanding of Labour Law during this COVID-19 outbreak.

 

Viranpat Kitsuwanrat
Nawapon Yaempiromsri

Translated by Kanyakorn Sakulpram