Daikin Industries (Thailand) Co has locked out about 1,300 workers, beginning Saturday, after negotiations over annual bonuses and benefits collapsed. The company stressed that the measure is temporary and does not amount to termination.
The Japanese air-conditioner manufacturer, located in the Amata City Chonburi industrial estate, issued formal notice of the lockout to the Daikin Amata Rak Seri Labour Union and the provincial labour conciliation office on Thursday.
Daikin said it was exercising its legal right under Thai labour law to lock out employees after mediation failed to resolve the dispute. The lockout is set to take effect at 8am on December 6 and will remain in place until further notice.
The conflict stems from the company’s decision to offer an annual bonus equivalent to five months’ salary plus 12,000 baht. The union demanded a larger payout, arguing that the company’s profits — reportedly 5.9 billion baht in the last fiscal year — justify a higher bonus.
The union also objected to the cancellation of a long-standing practice in which gold was awarded to long-serving employees, a benefit historically included in older employment contracts.
Negotiations between the two sides have been ongoing since September, with the most recent round held on Decembere 4.
Union president Manit Piyang said the lockout announcement came unexpectedly, noting that another mediation session, the twelfth since talks began, is scheduled for December 8.
During negotiations, the union requested an eight-month bonus, an additional 24,000 baht, and three baht-weight of gold for employees with more than 10 years of service.
Manit added that although the union put forward these figures, a compromise would likely fall below the initial request.
He said the company agreed to only a 3% salary increase, compared with the union’s call for 6%. Many workers, he noted, earn slightly above 10,000 baht per month and require a greater adjustment.
The company argued it must preserve liquidity amid economic pressures and competition. The union countered that Daikin’s performance has improved every year and that it remains financially capable of honouring long-standing benefits.
The union also maintained that eliminating the gold benefit amounted to a breach of contract.
In the latest round of talks, Daikin offered a six-month bonus, an additional 12,000 baht, and a 40,000-baht cash payment in place of the traditional gold award for long-serving employees.
The offer was rejected by most employees, who said the cash compensation was far below the current value of three baht-weight of gold. Gold prices have risen sharply — 55% since the end of 2024 — placing the value of the gold benefit at around 192,000 baht.
Manit said the gold incentive was based on individual agreements between workers and the company, not a union-negotiated benefit. Under company rules, employees with at least five years of perfect attendance earn one baht-weight of gold, with larger amounts provided over time.
Any changes to the scheme, he said, must be discussed directly with employees.
Daikin said in its statement that Thai law allows employers to impose a lockout when disputes cannot be settled through negotiation. Employees affected by the lockout will be barred from entering the workplace and will not receive wages until the order is lifted or a settlement is reached.
The Eastern Labor Relations Group, a coalition of unions and labour advocates in the Eastern Seaboard region, issued a statement condemning Daikin’s decision.
It urged the company to lift the lockout immediately and publicly disclose its financial records to demonstrate whether it can meet union demands.
The group also called on labour conciliation officials to accelerate mediation and work toward a prompt resolution.
Daikin first entered Thailand in 1975 under the name Siam Daikin Co Ltd. It established a major manufacturing hub and adopted its current name in 1991. Today, the company employs about 5,000 people in Thailand, most of them at its Amata City Chonburi facilities.
