What Payments Are Included in the Employee Welfare Fund Contribution Base? Salary, OT, Bonus and Allowances Explained
A practical guide to the wage base used to calculate employee and employer contributions to Thailand's Employee Welfare Fund, including salary, overtime, bonuses, position allowances, commissions and other payroll items, ahead of the contribution requirement effective 1 October 2026.
Key Point for HR & Payroll
Employee Welfare Fund contributions are not necessarily calculated on an employee's total Gross Income shown on the payslip. The contribution base is determined by “wages” within the meaning of Thailand's Labour Protection Act. Each type of payment must therefore be assessed to determine whether it constitutes wages for this purpose.
Contents
Employee Welfare Fund contributions are based on qualifying “wages” rather than automatically being calculated on every item of income shown on an employee's payslip.
What Is the Employee Welfare Fund Contribution Base?
One of the key questions for employers, HR teams and payroll professionals is whether Employee Welfare Fund contributions should be calculated on basic salary or on an employee's total income.
The key principle is that employee and employer contributions to the Employee Welfare Fund are calculated based on “wages” within the meaning of Thailand's Labour Protection Act B.E. 2541 (1998).
In general, wages refer to money agreed between an employer and an employee as remuneration for work performed under an employment contract during normal working hours. This may be calculated on an hourly, daily, weekly or monthly basis, or based on work output achieved during normal working hours.
The definition also covers payments that an employer is required to pay an employee for holidays and leave days for which the employee is legally entitled to receive wages, even though no work is performed on those days.
The Employee Welfare Fund contribution base does not necessarily equal the employee's total Gross Income shown on the payslip. Each payroll item should be reviewed to determine whether it falls within the legal definition of “wages.”
What Are the Employee Welfare Fund Contribution Rates?
The employee contribution and employer contribution rates are divided into two periods:
| Period | Employee Contribution | Employer Contribution | Total |
|---|---|---|---|
| 1 Oct 2026 – 30 Sep 2031 | 0.25% of wages | 0.25% of wages | 0.50% |
| From 1 Oct 2031 onwards | 0.50% of wages | 0.50% of wages | 1.00% |
Which Payments Are Included in the Employee Welfare Fund Contribution Base?
The following table provides an initial guide for reviewing an organisation's Payroll Items or Earning Codes.
| Payment Type | General Treatment | Key Consideration |
|---|---|---|
| Salary / Regular Wages | ✓ Included | Remuneration for work performed during normal working hours. |
| Daily / Hourly Wages | ✓ Included | Where the payment represents wages for normal working hours. |
| Position Allowance | ✓ Generally Included | Where it is paid regularly as remuneration for performing duties in a particular position. |
| Cost-of-Living Allowance | ✓ Generally Included | Where it forms part of remuneration for work and is paid without separate conditions. |
| Performance-Based Wages / Trip-Based Pay / Percentage-Based Work Payments | ⚠ May Be Included | Where the payment is remuneration for work or output achieved during normal working hours. |
| Commission | ⚠ Requires Review | The payment structure and conditions should be reviewed to determine whether the commission constitutes remuneration for normal work or an incentive subject to specific conditions. |
| Incentive | ⚠ Requires Review | The purpose and actual payment conditions should be reviewed. |
| Shift Allowance | ⚠ Requires Review | The payment arrangement should be reviewed to determine whether it constitutes remuneration for normal work. |
| Overtime Pay (OT) | ✕ Generally Excluded | Compensation for work performed outside normal working hours. |
| Holiday Work Pay | ✕ Generally Excluded | Compensation for work performed on a holiday, separate from wages for normal working hours. |
| Holiday Overtime Pay | ✕ Generally Excluded | Compensation for overtime work performed on a holiday. |
| Performance-Based / Conditional Bonus | ✕ Generally Excluded | Where the payment is a reward or bonus rather than remuneration for normal work. |
| Guaranteed / Fixed Bonus | ⚠ Requires Review | Where payment is contractually guaranteed, further assessment may be required to determine whether it constitutes wages. |
| Attendance Allowance | ✕ Generally Excluded | Where it is an incentive subject to conditions such as no absence, leave or lateness. |
| Service Charge | ✕ Generally Excluded | Where it represents an allocation of service charges rather than remuneration for normal work. |
| Meals / Travel / Telephone Expenses Reimbursed at Actual Cost | ✕ Generally Excluded | Where the payment is reimbursement of actual business expenses or provided as a welfare benefit. |
| Fixed Travel / Fuel / Telephone Allowance | ⚠ Requires Review | If a fixed amount is paid regularly regardless of actual expenses, it may need to be assessed as part of wages. |
| Employee Assistance / Welfare Benefits | ✕ Generally Excluded | Where the payment is provided as employee welfare rather than remuneration for work. |
Why Can't the Payroll Item Name Alone Determine the Treatment?
Organisations may use different payroll item names, such as Travel Allowance, Fuel Allowance, Telephone Allowance, Position Allowance, Commission or Incentive. However, the Payroll Item name alone does not determine whether the payment constitutes wages.
Example 1: Reimbursement of Actual Travel Expenses
An employee travels to meet a client and submits supporting documents to claim reimbursement for the actual travel expenses incurred.
Example 2: Fixed Monthly Travel Allowance
An employer pays a fixed “Travel Allowance” of THB 3,000 every month, regardless of whether the employee actually travels and without requiring supporting expense documentation.
Employee Welfare Fund Contribution Calculation Example: 0.25%
Assume an employee receives the following payments in October 2026:
| Payroll Item | Amount | Treatment in This Example |
|---|---|---|
| Basic Salary | THB 30,000 | ✓ Included |
| Fixed Position Allowance | THB 3,000 | ✓ Included |
| Overtime Pay (OT) | THB 4,000 | ✕ Excluded |
| Conditional Attendance Allowance | THB 1,000 | ✕ Excluded |
| Actual Travel Expense Reimbursement | THB 2,000 | ✕ Excluded |
| Total Gross Income | THB 40,000 | — |
| Qualifying Wage Base in This Example | THB 33,000 | ✓ Contribution Base |
Employee Contribution
Employer Contribution
Although the employee's total Gross Income is THB 40,000, the qualifying wage base used in this example is THB 33,000.
Is There a Maximum Wage Ceiling for Employee Welfare Fund Contributions?
An important point for payroll teams is that the Social Security contribution wage rules should not automatically be applied to the Employee Welfare Fund.
Under the Employee Welfare Fund contribution framework, there is no maximum wage ceiling for calculating employee and employer contributions equivalent to the contribution ceiling applied under Thailand's Social Security system.
How Should Employers, HR and Payroll Prepare Before 1 October 2026?
Preparing for the Employee Welfare Fund should involve more than simply adding a 0.25% deduction formula to the payroll system. The critical first step is to correctly identify the qualifying wage base.
HR & Payroll Checklist
-
Review all Earning Codes
Review salary, position allowance, cost-of-living allowance, overtime, bonuses, commission, incentives, shift allowances and all other payment items currently configured in the payroll system. -
Identify payments that constitute wages
Determine which payments represent remuneration for work performed during normal working hours. -
Separate overtime and holiday work payments
These items should not automatically be included in the qualifying wage base. -
Review fixed allowances
Pay particular attention to travel, fuel, telephone and other allowances paid as fixed amounts each month. -
Review Commission and Incentive arrangements
Assess the actual contractual terms and payment conditions before configuring the payroll treatment. -
Update Payroll Configuration
Correctly configure which payroll items should be included in or excluded from the Employee Welfare Fund contribution base. -
Perform pre-implementation testing
Verify the qualifying wage base, employee contribution, employer contribution and amounts displayed on the payslip before going live.
Payroll items with clear treatment can be configured as Include EWF or Exclude EWF. Items whose treatment depends on the organisation's specific payment arrangements should be classified as Review Required before payroll configuration is finalised.
Frequently Asked Questions About the Employee Welfare Fund Wage Base
Is the Employee Welfare Fund calculated on basic salary or total income?
The Employee Welfare Fund is calculated based on “wages” within the meaning of Thailand's labour protection law, rather than automatically on all income shown on an employee's payslip. Each type of payment must be assessed to determine whether it constitutes wages.
Is overtime pay included in the Employee Welfare Fund contribution base?
In general, overtime pay (OT) is not included in the wage base used to calculate Employee Welfare Fund contributions, as it represents compensation for work performed outside normal working hours.
Are holiday work pay and holiday overtime included?
In general, holiday work pay and holiday overtime are compensation separate from wages for normal working hours and should not automatically be included in the contribution base.
Is a bonus included in the Employee Welfare Fund contribution base?
A performance-based or conditional bonus that is in the nature of a reward is generally not treated as wages. However, where a bonus is contractually guaranteed, the specific facts and payment conditions should be reviewed to determine whether it constitutes wages.
Is a position allowance included in the contribution base?
Where a position allowance is paid regularly as remuneration for performing duties in a particular position, it may generally constitute wages and therefore be included in the contribution base.
Are Commission and Incentive payments included?
The treatment depends on the purpose, contractual arrangement and actual payment conditions. The determination should not be based solely on the payroll item name or the fact that the payment is made regularly.
Is a travel allowance included in the contribution base?
Where travel expenses are reimbursed based on actual costs incurred, the payment is generally in the nature of expense reimbursement. However, a fixed recurring travel allowance that is unrelated to actual expenses may require further assessment to determine whether it constitutes wages.
Does the Employee Welfare Fund have the same wage ceiling as Social Security?
The Employee Welfare Fund does not use the Social Security contribution wage ceiling. The Social Security ceiling should therefore not automatically be applied when calculating Employee Welfare Fund contributions.
When do Employee Welfare Fund contributions begin?
Employee and employer contributions commence on 1 October 2026, with an initial contribution rate of 0.25% of wages for each party.
Summary
The key principle for Employee Welfare Fund contribution calculations is that contributions are “calculated on qualifying wages under the law, rather than automatically on all income shown on the payslip.”
Basic salary and remuneration for normal work are key items that should be considered as part of the wage base. Overtime, holiday work pay, bonuses, welfare benefits, commission, incentives and other payments may require different treatment depending on their purpose and payment conditions.
Do not simply add a 0.25% contribution formula to the payroll system.
Start by asking:
“Which Payroll Items constitute qualifying wages for Employee Welfare Fund contributions?”
Reviewing the wage base correctly from the outset can help reduce the risk of incorrect employee deductions, incorrect employer contributions and inaccurate Fund remittances.
If your organisation has determined that it falls within the scope of the Employee Welfare Fund, you may also review our guide on Employee Welfare Fund Registration for Employers .
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References: Department of Labour Protection and Welfare, Ministry of Labour / Labour Protection Act B.E. 2541 (1998) / Relevant laws and regulations governing the Employee Welfare Fund
Last updated: 17 September 2026
