Social security is a legal requirement that every employer must register and contribute to for the benefit of their employees. However, it often presents challenges, particularly for employers with a small workforce or limited business income. For these employers, complying with social security regulations can become a financial burden.

Today, I’d like to discuss this issue and share some frequently asked questions from the employer’s perspective.

Table of Contents

• How many employees require social security?

• Penalties for Not Paying Social Security
Failure

• How Much Do Employers Pay for Social Security Each Month?

• How to Pay Social Security Contributions Online

• Advantages of Social Security for Employers

How many employees require social security?

Under Thailand’s Social Security Act, if a company or establishment employs at least one worker, the employer is required to register the employee as an insured person with the Social Security Office and start contributing to the social security fund within 30 days of the employee’s start date. This registration applies to both permanent and temporary employees in the company, ensuring that all employees are covered by the basic benefits and welfare provided by the social security fund.This includes probationary employees as well.

Therefore, employers need to carefully calculate their costs—even one employee requires social security contributions.

Penalties for Not Paying Social Security

  Failure to comply with social security regulations can result in legal penalties for employers. The penalties for not registering employees with the social security system or for neglecting regular contributions include both administrative and criminal consequences. Employers may be required to pay fines that exceed the amount owed, plus additional interest. In cases of severe violations, employers may also face imprisonment. Furthermore, the Social Security Office may take legal action to recover unpaid contributions, which can negatively impact the company’s image and reputation.
The penalties are divided into two categories as follows:

1. Late Registration or Deregistration of Employees

• Late Employee Registration: If an employer registers an employee more than 30 days after the start date, it may result in overcompensation of unemployment benefits from social security in cases where the employee is still in the process of claiming unemployment income compensation. This delay violates the Social Security Act, B.E. 2533 (1990), and can result in penalties of up to 6 months imprisonment, a fine of up to 20,000 baht, or both.

• Late Deregistration of an Employee: If an employer delays notifying the Social Security Office of an employee’s termination beyond the 15th of the following month, it may cause issues for the employee, such as preventing them from applying for unemployment income compensation because they are still listed as employed in the social security system. This violation of the Social Security Act, B.E. 2533 (1990), can also lead to penalties of up to 6 months imprisonment, a fine of up to 20,000 baht, or both.

2. Failure to Pay Social Security Contributions

• Non-payment of Social Security Contributions: If an employer fails to pay social security contributions on behalf of their employees, they are in violation of the Social Security Act, B.E. 2533 (1990), which can lead to penalties of up to 6 months imprisonment, a fine of up to 20,000 baht, or both.

•Late Payment of Contributions: If an employer submits the social security contribution after the 15th of the following month (after the employee’s pay month), they must pay an additional 2% per month from the due date.

For example, for wages paid in March, the employer must deduct and submit contributions to social security by April 15. If contributions are paid on April 30, the employer must pay an extra 2% for the 15-day delay (half a month).

• Incomplete Payment of Contributions: If an employer underpays the social security contributions, they must pay an additional charge of 2% per month on the unpaid amount.

How Much Do Employers Pay for Social Security Each Month?

    Social security contributions are divided into three parts: the employer, the employee, and the government. Both the employer and the employee contribute 5% of the employee’s monthly salary to the fund, but the maximum contribution is capped at 750 baht per month, regardless of the employee’s actual income.

The government also contributes a designated portion to the fund.
These contributions are pooled into the social security fund and used to provide benefits such as healthcare, income compensation, and future gratuity or pension payments for employees.

How to Pay Social Security Contributions Online

    The Social Security Office has developed an online payment system that is convenient and fast. Employers can visit the Social Security Office website (www.sso.go.th) to register for online contribution payment services. The process is simple and includes the following steps:

• Log in: Employers must register for the SSO Connect system or log in using the credentials provided by the Social Security Office.
• Select Contribution Payment: The system will display the amount to be paid based on the number of employees and their recorded salary base.
• Choose Payment Method: Employers can select various payment methods, such as online banking, mobile app transfers, or ATM transactions, as offered by participating banks.
• Confirm and Receive Receipt: Once the payment is completed, the system will generate a receipt as proof of payment, which can be printed for record-keeping.

Online payment of social security contributions helps reduce time and complexity, making it easier for employers to comply with legal requirements.

Advantages of Social Security for Employers

  Providing social security for employees is not only a legal requirement but also brings several benefits to employers:

• Enhances Business Image: Offering adequate social security benefits reflects a company’s commitment to its employees’ well-being, which can serve as a competitive advantage and attract high-quality employees.
• Increases Workforce Stability: Employees who receive social security benefits feel more secure in their jobs, which reduces turnover and boosts loyalty to the company.
• Reduces Legal Risks: Compliance with legal obligations prevents potential legal issues and fines related to missed contributions.
• Supports Risk Management: Employers can rely on social security benefits to cover employee healthcare, reducing direct costs for medical expenses or compensation in cases of employee illness or accidents.

Summary

Social security creates stability and protection for both employees and employers. Once a business has at least one employee, the employer must register and make consistent contributions.

Online contributions simplify the process, reducing the risk of legal issues from missed payments. Additionally, social security strengthens workforce stability and enhances the company’s image, supporting long-term growth and development.

If you need advice or encounter issues related to employers, employees, labor laws, or internal organizational contracts, feel free to consult with us. We are here to help resolve your problems effectively.

Content by KAWEE 

Compiled by CHAMP LAWYER