Employment and Labor

 

Employment and Labor

1.   Regulatory Framework for the Labor Relations

Cambodian labor relations, employment and work terms and other labor-related matters are basically regulated by the Constitution and the 1997 Labor Law. The 1997 Labor Law, which was enacted in March 1997 and brought significant modification into the socialistic 1992 Labor Law, is quite liberal and protects the considerable rights of laborers and unions.

2.   Provisions under the Constitution Relating to Employment in Cambodia

Major provisions of the Constitution relating to the employment are as follows.

  Khmer citizens of either sex shall enjoy the right to choose any employment according their ability and to the needs of the society (Article 36).

  Khmer citizens of either sex shall receive equal pay for equal work (Article 36).

  Khmer citizens of either sex shall have the right to form and to be a member of trade unions (Article 36).

  The organization and conduct of trade unions shall be determined by law (Article 36).

  The right to strike and to non-violent demonstration shall be implemented in the framework of a law (Article 37).

  All forms of discrimination against women shall be abolished. The exploitation of women in employment shall be prohibited (Article 45).

  A woman shall not lose her job because of pregnancy. Woman shall have the right to take maternity leave with full pay and with no loss of seniority or other social benefits (Article 46).

  The state and society shall provide opportunities to women, especially to those living in rural areas without adequate social support, so they can get employment, medical care, send their children to school, and have decent living conditions (Article 46).

 

3.   Major Provisions under the Labor Law

 

The 1997 Labor Law provides wide protection of laborers’ rights and offers generous working conditions. The key regulations of the Law are as follows.

 

General

  Forced Labor:

Forced or compulsory labor is absolutely forbidden (Article 15).

  Declaration of opening and closing of the enterprise

All employers to whom this Labor Law is applied, shall make a declaration to the Ministry in charge of Labor when opening an enterprise or establishment. This declaration must be made in writing (Article 17).

  Declaration on Movement of Personnel:

Every employer must make the declaration to the Ministry (Ministry of Labor and Vocational Training: MLVT) each time it hires or dismisses a worker. This declaration must be made in writing within fifteen days of the date of hiring or dismissal (Article 21).

  Internal Regulations:

Every employer who employs at least eight workers shall establish internal regulations for the enterprise (Article 22).

  Child Labor:

The allowable minimum age is set at fifteen years. The minimum allowable age for any kind of employment or work, which, by its nature, could be hazardous to the health, the safety, or the morality of an adolescent, is eighteen years (Article 177).

  Hiring:

An employer can directly recruit workers for his enterprise, but he must meet the requirements mentioned in Article 21 of this law (Article 258).

 

Employment Contract

  Employment Contract:

A labor contract is subject to ordinary law and can be made in a form that is agreed upon by the contracting parties. It can be written or verbal (Article 65).

A labor contract signed for a specific duration must contain a precise finishing date and cannot be for a period longer than two years. It can be renewed one or more times, as long as the renewal does not surpass the maximum duration of two years. Any violation of this rule leads to the contract’s becoming a labor contract of undetermined duration (Article 67).

  Termination of Labor Contract:

A labor contract of specific duration normally terminates at the specified ending date. It can, however, be terminated before the ending date if both parties are in agreement and such  agreement is made in the form of writing in the presence of a Labor Inspector and signed by the two parties to the contract. If both parties do not agree, a contract of specified duration can be cancelled before its termination date only in the event of serious misconduct or acts of God. The premature termination of the contract by the will of the employer alone for reasons other than those mentioned in paragraphs 1 and 2 of this article entitles the worker to damages in an amount at least equal to the remuneration he would have received until the termination of the contract (Article 73).

A labor contract of unspecified duration can be terminated at will by one of the contracting parties (subject to various exceptions). This termination shall be subject to prior notice in writing by the party who intends to terminate the contract to the other party (Article 74). The termination of a labor contract at wills on the part of the employer alone, without prior notice or without compliance with the prior notice periods, entails the obligation of the employer to compensate the worker the amount equal to the wages and all kinds of benefits that the worker would have received during the official notice period (Article 77).

Wages

 Guaranteed Minimum Wages:

The wage must be at least equal to the guaranteed minimum wage; that is, it must ensure every worker a decent standard of living compatible with human dignity. (Article 104)

The guaranteed minimum wage is established without distinction among professions or jobs and set by a Ministerial Order of the Ministry in charge of Labor (Article 107).

  Payment of Wages:

The wage must be paid directly to the worker concerned, unless the worker agrees to get paid by other methods. The wage shall be paid in coin or bank note (Article 113).

Laborers’ wages shall be paid at least two times per month, at a maximum of sixteen-day intervals and Employees’ wages must be paid at least once per month (Article 116).

Working Hours

  Working Hours:

The number of hours worked by workers of either sex cannot exceed eight hours per day, or 48 hours per week (Article 137).

  Work Shift:

When the work schedule consists of split shifts, the enterprise’s management can normally set up only two shifts, one in the morning and the other in the afternoon (Article138).

  Overtime:

If workers are required to work overtime for exceptional and urgent jobs, the overtime hours shall be paid at a rate of 50% higher than normal hours.

If the overtime hours are worked at night the interval from 22:00 pm to 05:00 am or during weekly time off, the rate of increase shall be 100% (New Article 139*).

  Night Work:

For the purpose of this law, the term “night” represents a period of at least eleven (11) consecutive hours that includes the interval between 22:00 and 05:00 hour. The night work shall be calculated from 22:00 pm to 05:00 am. Besides continuous work that is performed by rotating worker teams who sometimes work during the day and sometimes at night, the work at the enterprise can always include a portion of night work. The night work is paid at the rate of 130% of the wage of the daytime work (New Article 144*).

Leave

  Weekly Time Off:

It is prohibited from using the same worker for more than six days per week (Article 146).

Weekly time off shall last for a minimum of twenty-four consecutive hours and shall, in principle, be given on Sunday (Article 147).

  Paid Leave:

All workers are entitled to paid annual leave at the rate of one and a half work days per month of continuous service. As stated above, the length of paid leave increases according to the seniority of workers at the rate of one day per three years of service (Article 166).

  Annual Leave:

Annual leave is normally given for the Khmer New Year. In every case of the paid annual leave exceeding fifteen days, employers have the right to grant the remaining days-off at another time of the year (Article 170).

  Special Leave:

The employer has the right to grant his worker special leave during an event directly affecting the worker’s immediate family (up to a maximum of seven days during any event directly affecting the worker’s immediate family) (Article 169 & 171).

  Maternity Leave:

Women shall be entitled to a maternity leave of ninety days. After the maternity leave and during the first two months after returning to work, they are only expected to perform light work.  During the maternity leave, women are entitled to half of their wage (Article 182 and 183).

Union

  Union:

Workers and employers have, without distinction whatsoever or prior authorization, the right to form professional organizations of their own choice for the exclusive purpose of studying, promoting the interests, and protecting the rights, as well as the moral and material interests, both collectively and individually, of the persons covered by the organization’s statutes. Professional organizations of workers are called “workers’ unions”. Professional organizations of employers are called “employers’ associations”. For the purposes of this law, trade unions or associations that include both employers and workers are forbidden (Article 266 and Ministerial Order 305).

  Representation of Workers in the Enterprise:

In every enterprise or establishment where at least eight workers are normally employed, the workers shall elect a shop steward to be the sole representative of all workers who are eligible to vote in the enterprise or establishment (Article 283).

  Right to Strike:

The right to strike and to lockout is guaranteed. It can be exercised by one of the parties to a dispute in the event of rejecting the arbitral decision (Article 319).

The right to strike can also be exercised when the Council of Arbitration has not rendered or informed of its arbitration decision within the prescribed time periods (The Labor Law). It can also be exercised when the union representing the workers deems that it has to exert this right to enforce compliance with a collective agreement or with the law.  It can also be exercised, in a general manner, to defend the economic and socio-occupational interests of workers (Article 320).

  Prior Notice for Strike:

A strike must be preceded by prior notice of at least seven working days and be filed with the enterprise or establishment. The prior notice must also be sent to the Ministry in charge of Labor (Article 324).

  Manner of Strike:

A strike must be peaceful. Committing violent acts during a strike is considered serious misconduct that could be punished, including work suspension or disciplinary layoff (Article 330).

Freedom of work for non-strikers shall be protected against all form of coercion or threat (Article 331).

4.   Foreign Employees

Regarding foreign employees, the 1997 Labor Law sets out the following regulations.

No foreigner can work unless he possesses a work permit and an employment card issued by the Ministry in charge of Labor. These foreigners must also meet the following conditions:

a.    Employers must beforehand have a legal work permit to work in the Kingdom of Cambodia;

b.   These foreigners must have legally entered the Kingdom of Cambodia;

c.    These foreigners must possess a valid passport;

d.   These foreigners must possess a valid residency permit;

e.    These foreigners must be fit for their job and have no contagious diseases. These conditions must be determined by a Prakas (Ministerial Order) from the Ministry of Health with the approval of the Ministry in charge of Labor.

The work permit is valid for one year and may be extended as long as the validity of extension does not exceed the fixed period in the residency permit of the person in question (Article 261). The Ministry in charge of Labor shall issue a Prakas (Ministerial Order) for the issuance of work permits and employment cards to foreign workers (Article 262).

The maximum percentage of foreigners who can be employed in each of the enterprises shall be determined by a Prakas of the Minister in charge of Labor based on each of the categories of personnel as follows (Article 264).

a.    Office personnel

b.   Specialized personnel

c.          Non-specialized personnel

5.Worker employment information
Source: Japan Desk, CDC

“Cambodia-Japan Cooperation Center (CJCC)”, which was established in 2004 under the assistance and cooperation of Japan International Cooperation Agency (JICA), has been providing various Japanese language courses as well as management-related courses to Cambodian citizens. The Japanese language courses according to own request of investor can be arranged to provide.