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Logo of Phnom Penh Post newspaper Phnom Penh Post - Unique pension plan pushed

Workers sew zippers on to garments at a factory in Phnom Penh last year
Workers sew zippers on to garments at a factory in Phnom Penh last year. A newly founded union is aiming to provide its members with a retirement pension without member contribution. Pha Lina

Unique pension plan pushed

A new union has been founded pledging to offer members a post-retirement pension with a novel twist – it will be funded by sponsorship from private companies.

The head of the new Workers Retirement Fund of Cambodia Union president, Sidney Sok Ke, claims to have spent the better part of a decade coming up with the idea and drafting the union’s regulations.

“We got a licence from the Ministry of Labour at the end of February, and we are just starting to work by cooperating with three labour federations that have more than 60,000 members,” he said.

Members wishing to join the union, which Sok Ke stressed will be open to workers from any sector, will need to commit to at least 10 years up front.

In return, at the age of 62, they will receive a pension fund. But the money will not come from salary contributions; rather, a number of as-yet-undetermined private sponsors will pay the pensions.

But the money for the fund will still originate with the workers, Sok Ke added, as they will be obliged to buy products, such as rice and mobile phones, from the sponsors.

“The members will receive support or funds from our union when they are 62 years old and have been members for 10 years,” he said. “They don’t need to pay money to contribute to our union, but they have to use the products of the companies that sign contracts with the union.”

The union has received a resounding endorsement from Minister of Labour Ith Sam Heng, who met with Sok Ke on Tuesday. “We want to see this union functioning well and providing effective assistance to retiring workers without having any party affiliation or partisanship,” he said.

Reaction to the establishment of the scheme from other union leaders was mixed yesterday.

Rong Chhun, president of the Cambodian Confederation of Unions, said he welcomed the new player if it could benefit older workers in the long term.

“But we are worried about how they will get enough resources to support the workers,” he added.

Pav Sina, president of the Collective Union of Movement of Workers, worried that the relationship between union and sponsors could leave workers in a vulnerable position.

“I think the union will benefit more than the workers, because it will try to promote the companies’ services,” he said.

Dave Welsh, of the US-based Solidarity Centre, said that while he could not comment on the new union’s specifics, “Anything that doesn’t promote what’s in the Labour Law – independent, democratic labour unions in every sector – weakens what is going on overall.”




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