Expats will be pleased to know working conditions and workers rights in Cambodia are improving thanks to labour laws set out by the government, as they aim to adhere to international standards. Everyone receiving remuneration for work carried out is equally covered by the law.
As well as a business visa, before starting work, you will also be required to obtain a work permit and health certificate from the Ministry of Labour to confirm that you are eligible and physically able to undertake the work required, and a residence permit issued from your local Sangkat office.
Sangkat offices are the local authorities in Cambodia, there is one for every district of a city and every town and village. They are responsible for the administration of local services.
Work contracts
There are two distinct types of employment contracts in Cambodia: fixed duration and unspecified duration.
A fixed duration contract covers up to two years of continuous employment, including any extensions. A fixed duration contract must be in writing and include precise commencement and termination dates. If any one of these conditions are not fulfilled the contract is therefore an unspecified duration.
The main difference between the two types of contracts is the way in which they can be terminated. An unspecified duration contract offers more security as the employer is required to provide a reason for the termination of the contract, whereas a fixed duration contract is very limited and an employer can simply decide not to renew it at the end of the two years. It is paramount that you understand the intricacies of your contract before signing.
Working hours
Cambodian labour laws state that employees can work a maximum of 48 hours per week and a maximum of 8 hours per day. It is compulsory that employees have a full day (24 hours) off every week; and unless otherwise agreed, this is usually a Sunday. Anyone working under 48 hours a week is considered part-time.
Holiday leave
Everyone in Cambodia is eligible for annual leave each year. This is 18 days for full-time workers and for every 3 years of continuous service you are granted one extra day. Any annual leave that has not be used upon the termination of a contract will be paid to the employee.
For part-time workers the amount of annual leave is proportional to the number of hours worked. Employees are also paid for public holidays. Employers can ask staff to work public holidays, but employees are within their rights to refuse. If work is undertaken on public holidays workers must receive 200% pay.
Sick pay & special leave
Sick pay, however, is not explicitly explained in law. Organisations are advised to create their own internal policy with regards to sick pay. Companies do, however, have an obligation to hold a position for a sick member of staff for at least six months, after the six months have expired a contract may be terminated.
Employees are also granted special leave in the case of a birth, marriage, death or sickness of child, parent or spouse. Any time taken off from work for special leave is deducted from their remaining annual leave for that year; if no annual leave remains it cannot be taken from the next year. It can also be made up in overtime if the employer desires.
Overtime
Overtime in Cambodia is voluntary and employers cannot persecute a member of staff for refusing to undertake extra hours of work. Even taking into account overtime, employees are only allowed within the law to work 10 hours per day or 54 hours per week. Overtime is paid at a rate of 150% and a rate of 200% if work is completed at night or at weekends.
Salary
The Cambodian government has set in motion plans to introduce a minimum wage of US$200 a month over the next 5 years (from 2013) and to achieve a minimum wage of around US$150 as soon as possible. This will be applied to factory workers, construction workers, domestic servants and hospitality staff. They hope to have implemented a US$20-30 increase by 2014. Although the cost of living is relatively low in Cambodia compared with more developed countries, it is a challenge for Cambodians trying to get out of poverty on such low incomes. As it stands, the minimum wage in Cambodia has just been increased to US$75 a month.
For barangs (foreigners) however, depending on the type of work, you can expect to earn considerably more than the average Cambodian. For example, teachers of English can earn around US$1,000 per month (US$10 per hour) for 25 hours of teaching a week.
Social security & pensions
In Cambodia social security and worker protection is administered by the National Social Security Fund (NSSF). It is the responsibility of the employer and the employee to register. In order to ensure compliance there are penalties in place for nonpayment or underpayment of contributions and registration with false information. Contributions are set at a standard rate of 0.8% of monthly salary before tax is deducted.
It is the sole responsibility of employers to make contributions to cover risk of injury in the workplace. These contributions are used to provide benefits to victims of occupational accidents to help pay for medical expenses and the cost of transportation to hospital. If an occupational accident results in permanent disability the victim will be compensated with a lifetime pension based on loss of earning ability.
By 2015, the government intends to have a nationwide pension scheme in place. It will be mandatory for any company with more than eight employees to register. Currently only government workers and veterans are eligible for a state pension. To be eligible for the proposed pension, workers will need to have been registered with the NSSF for at least 20 years and have been paying into it for at least 5 of the 10 years preceding their retirement. Entitlement begins at the age of 55 for women and 60 for men.