Thailand: Proposed amendments to social security benefits and contributions

Employer Action Code: Monitor

The Minister of Labor has published plans to amend the social security system to meet the financial challenges of an aging society.  Proposed measures include extending the social security contribution age to 65 and raising covered pay for contributions. 

Key details

The proposed measures include the following:

• Expanding the social security participation requirement, currently applicable to employees age 15 to 60, to employees age 15 to 65. There would be no change in the minimum age required to claim a pension (age 55) when leaving the workforce.
• Gradually raising the ceiling on covered monthly pay for social security contributions and benefits, from 15,000 Thai bahts (THB) to THB 17,500 starting January 1, 2026, and then again to THB 20,000 in 2029 and THB 23,000 in 2032.
• Having the state’s Social Security Fund pursue a more aggressive investment strategy, by increasing exposure to foreign equity markets (particularly in the U.S. and Europe), to increase long-term expected returns and help finance social security benefits.

Employer implications

Employers should monitor the evolution of the proposed changes. According to World Health Organization data, Thailand’s fertility rate was around 1.3 births per woman as of 2022, one of the lowest in the Southeast Asia region and significantly below the replacement level of 2.1. Simultaneously, Thailand’s life expectancy has risen to age 75 (one of the highest in the region), while covered pay for benefits and normal retirement age for retirement benefits have remained unchanged since the system was established. There have been a number of prior efforts to enact social security reforms, but this proposal appears to have broader support.

Separately, in November 2024, the king signed decrees to implement Employee Welfare Funds, based on provisions in the 1998 Labor Law that up to then had never been implemented; a separate Global News Brief on this subject will be published in January 2025.