Prior to 2008, no duties and rights existed under the labour laws between business operators and outsourced workers. In order to provide better protection to outsourced workers, Section 11/1 of the Labor Protection Act B.E. 2541 ("Labor Protection Act") was introduced in 2008.
By virtue of paragraph 1 of Section 11/1, in cases where business operators hire outsourced workers via an outsourcing company to work in its business, the operator will be deemed an employer of the outsourced workers, in addition to the outsourcing company which is a direct employer of these workers. Thus, business operators must ensure that the outsourced workers are provided with minimum rights and benefits under the Labor Protection Act, including minimum wage, other statutory payments, and leave entitlement.
More interestingly, paragraph 2 of Section 11/1 further elaborates that the business operator shall arrange fair benefits and welfare without discrimination to the outsourced workers who have the same job descriptions as the directly hired employees. Given the opaque wordings of "fair benefits and welfare without discrimination", there have been many arguments regarding its actual meaning and scope. Some view that the outsourced workers are entitled to equal benefits and welfare as the directly hired employees, while some view that even though these benefits and welfare are to be provided to both types of employees, they may vary according to the available justifications, such as experience, skills, etc. The business operator who fails to comply with Section 11/1 shall be subject to a fine not exceeding THB 100,000.
In 2012, the Supreme Court shed some light on this issue in a case concerning a complaint brought by outsourced workers against business operators and outsourcing companies. The Supreme Court ruled that Section 11/1 applied since the outsourced workers were sent to work in the operator's main business, and, therefore, the business operator must treat the outsourced workers as their directly hired employees. Pursuant to paragraph 2 of Section 11/1, the business operator must arrange benefits and welfare in accordance with the regulations of the business operator without discrimination between the outsourced workers and the directly-hired employees. Interestingly, the Supreme Court emphasized that the "benefits and welfare" must cover all benefits and welfare provided to the directly-hired employees, regardless of the basis of such benefits and welfare, such as work regulations, an employment agreement, or even a collective bargaining agreement. In the case where outsourced workers receive some benefits and welfare from the outsourcing company (their direct employer), but such benefits and welfare are not equivalent to those granted to the operator's directly-hired employees, the business operator must provide the shortfalls to such outsourced workers. The Supreme Court also pointed out that the benefits and welfare shall be given to the outsourced workers in accordance with the same conditions and criteria used with the directly-hired employees. In cases where the outsourced workers do not qualify under the business operator's conditions and criteria of such benefits and welfare, they may not receive such benefits and welfare. The Court went on to state that the duty under paragraph 2 of Section 11/1 is imposed solely on the business operator, not on the outsourcing company.
Even though the aforementioned Supreme Court decision has given some guidance on the rules and implications of Section 11/1, regrettably it falls short of clarifying other important issues, and may even leave open some new unanswered issues. For example, in cases where the length of service is part of the business operator's criteria for consideration of benefits and welfare, how will the outsourced workers' length of service will be calculated (e.g. it could mean from the day that the business operator engaged the outsourcing company, when the outsourced workers are sent to work for the operator, or when they are hired by the outsourcing company). It is also interesting that the outsourced workers will receive benefits and welfare arising from a collective bargaining agreement while the business operator's own employees, who were not involved in such agreement, will not. More interestingly, if the business operator violates Section 11/1, how will the maximum fine be imposed (will it be per each outsourced worker, per each type of benefit and welfare, and/or per instance that the payment is made?) These interesting questions are still pending further clarification from the court in future cases. For the outsourcing company, for now, it seems they only need to provide rights and benefits under the law to their own outsourced workers, while leaving benefits and welfare beyond the legal requirements for the business operator to handle.