The problem is that XML::DOM is a maze of objects. And each node object can only have one parent. So you first stick the <record> object in place of the first Thammasat and then MOVE the object in place of the second. You'd have to create a brand new $ritem each time you want to replace the original.

To tell the truth, you'd most likely do better if you dumped the module and used a different. I'm surprised mirod did not already suggest his XML::Twig, anyway I'll suggest my XML::Rules:

use strict;
use XML::Rules;

my $link = "Thammasat";
my $rlinks =    {
    "institute" => ["test"],
    "year" => ["test"],
    "degree" => ["test"],
    "faculty" => ["test"],
    "major" => ["test"],
    "gpa" => ["test"],
};

my $parser = XML::Rules->new(
    style => 'filter',
    ident => '    ',
    rules => {
        _default => 'raw extended',
        record => sub {
            return $_[0] => $_[1] unless $_[1]->{':institute'}{_conten
+t} eq $link;

            return $_[0] => $rlinks;
        }
    },
);

$parser->filterfile('employee.xml', 'employee-filtered.xml');
[download]

The additional advantage is that this scripts doesn't load the whole file into memory, it parses the file, copies everything outside the <record> tag and only ever remembers that single tag with contents.