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Cambodia's Labor Law

Cambodia's Labor Law

I n 1992, the State of Cambodia, the government at that time, enacted a Labor Law

that is currently in effect. It appears from recent foreign press reports and

comments I've heard around town, that many still believe there is no labor law

in Cambodia.

For those unbelievers, Cambodia's currently effective "Labor

Law" was passed by the National Assembly on August 11, 1992, and signed into

effect by Heng Samrin in a Council of State Decree dated October 13, 1992. I

purchased my Khmer language version a few months ago (bound, soft cover booklet)

from the Ministry of Labor for 5,000 riels.

Of course, the existence of

law does not mean that the law is implemented or enforced. The implementation of

Cambodia's labor law suffers from the same deprivations facing other laws,

mainly a lack of financial and human resources. A shift in the focus of

international aid from legal drafting and training to the implementation and

enforcement of existing laws through open, transparent and equitable

administrative procedures would greatly benefit the Rule of Law in Cambodia now,

and when new laws are finally promulgated.

The Labor Law is based heavily

on Cambodia's 1972 Labor Code, with certain socialist modifications. While

certain provisions are outdated and overly socialist in nature, much is quite

applicable to employment relations in a market economy. Here is a brief overview

of the contents of the Labor Law, and a look more in-depth at work place




Record Keeping. The Law and subsequent directives issued by the Ministry of

Labor set out a number of record keeping and reporting requirements that

employers must follow. These include a book of "labor charges" that records

worker wages due and paid, a set of Internal Rules, company opening declaration,

a labor book for Cambodian and Foreign workers and a "labor card" for foreign


Employment Contract. The Law contains provisions on the employment contact,

the permitted probationary period for various types of employees, when and how

an employment relationship may be terminated, and the amount of compensation

owed to the employee for wrongful termination.

Wages and Other Benefits.

Unlike other countries where a national minimum wage is set but other benefits

are often left to employer discretion, Cambodia's Labor Law is quite vague about

wages but very detailed about other benefits. The minimum wage is defined solely

as the amount needed to ensure a living standard appropriate to a "human being's

dignity" and can vary from region to region. However, wages must be equal for

equal work, without regard to sex, nationality or age.

The law details the types of leave to which employees are entitled. These

include: one day off per week; national holidays, sick leave; maternity leave;

annual leave; and a special "public protest" leave of not more than ten


Foreign Workers. Employers who are doing business in Cambodia under a license

issued by the Cambodian Development Council, can bring in as many foreign

workers as they need, provided that employees with equivalent qualifications are

not available in Cambodia. Businesses not promoted by the CDC can only employ a

very small percentage of foreigners. Employing foreigners must be done in

compliance with all the relevant labor Directives, and the immigration


Other issues covered by the Labor Law include health care for

employees, collective bargaining rights and resolution of employment


Work Place Safety

Employers in Cambodia are required to appoint

one person who will oversee safety and sanitation in the work place,

particularly with regard to accident prevention. This person could be a regular

employee and does not have to perform this function on a full-time


Employers are required to keep all work areas clean and safe and

ensure worker's health. All electric and power installations must be checked by

qualified technicians, according to the Law.

If there are accidents in

which an employee is injured, the employer is responsible for arranging and

paying for all medical care.

The Labor Law is less clear on an employer's

responsibility to workers in the event they are forced to be absent from work

because a work-related injury or illness. If an employee is off work for more

than four days due to an injury or illness, the employee is entitled to some

sort of compensation, but again the amount is not clarified.

The Law

states that if an injury is crippling or results in permanent disability, the

employee is entitled to an annuity but this is not clarified further. In cases

of disability, the employer must satisfy all payments due within five days of

the accident.

Unlike many Western countries, there is no schedule of

payments made to workers for various types of injuries. Thus, if a worker in the

United States loses the use of a limb, the precise amount payable by the

employer is specified. The Cambodian Labor Law does not do this. Presumably, a

disagreement about the amount due the worker would be arbitrated by the Ministry

of Labor, or the courts.

There is a specified reconciliation procedure in

the event there is either a dispute with an individual employee over his/her

particular work conditions or with employees as a whole over general work

conditions. The labor inspector is responsible for attempting reconciliation

before the dispute is referred to the courts. This reconciliation procedure is

similar to those used in other countries, with the taking of statements by both

sides and attempting to have the parties come to an agreement among themselves.

However, if the parties still cannot agree, then they can use the judicial


In many Western countries "workers compensation" laws have tried

to do away with the concept of fault-i.e. whether the employer, the employee or

some other party was responsible for the employee's injury. By law, workers are

required to accept a specified amount of compensation for work-related accidents

or illness. However, they do not have to prove that an employer was at fault or

that the worker did not contribute in some way to the accident or illness. This

system is based on the historic difficulty that workers had in suing employers

for work place injuries and the difficulty the worker had in proving that the

employer was at fault.

On the other hand, although employers in Cambodia

are considered responsible for work place accidents, the Labor Law also allows a

court to reduce the amount of payment to a worker if it determines the accident

was largely caused by the employee's own "serious fault." Conversely, the amount

paid to the employee can be increased if the employer was at "serious


David Doran is the Resident Managing Director of law firm Dirksen Flipse

Doran & Le. DFDL has regional offices in Phnom Penh, Vientiane and Ho Chi

Minh City.


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