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Employee benefits

Employee benefits

THIS article continues our comparative analysis of employer-employee related topics.

In this article, we will look at employee benefits. Although often overlooked when

considering labor relations, employee benefits can be crucial in decision making

for both employers and employees.

A review of the laws of Singapore, Thailand, Taiwan and Malaysia (as in table displayed

at right) shows that all these countries impose various requirements for employee

benefits. These countries are a fairly representative sampling of the region and

form a valid basis of comparison with Cambodia.

Annual Leave

Annual leave is a part of the labor codes of the surrounding countries in the

region. In Singapore annual leave depends on length of service and can be up to 14

days per year. Thailand requires at least six days annual vacation at the end of

one year of service. Malaysia simply requires annual leave based on length of service

without specifying a minimum number. Cambodia is generous by regional standards since

its requirement that one and half days annual leave be given for each month of employment

results in a minimum 18 annual leave days per year. It is even more generous since

the law specifies that paid annual leave increases by one day per three years of

service.

Sick Leave

The new Labor Law does not require, or even mention, sick leave. The other countries

considered can be fairly generous. Singapore requires paid sick leave of up to 14

days per year without hospitalization, but 60 paid sick leave days per year if the

employee is hospitalized. Similarly, Malaysia states that sick leave is commensurate

with length of service, without stating a minimum number of days, but a hospitalization

will generally require up to 60 paid sick leave days per year. Thailand requires

30 paid sick leave days per year with no distinction made for hospitalization.

Although the new Labor Law does not require sick leave, the law is quite generous

with regard to other medical benefits if there are numerous employees. However, there

are only slight requirements for smaller establishments. All employers are required

to provide first aid and vaccinations to their employees. The previous labor law's

inclusion of responsibility to employees' families has been dropped and the specific

vaccinations that must be provided are not specified. For larger employers the requirements

are more detailed. Employers with more than 50 employees must have a dispensary on

site, staffed by a physician and nurse. Employers with more than 200 employees must

provide in-patient facilities.

Severance Pay

Severance pay and advance notice for layoffs are also required under various national

laws. In Singapore an unspecified amount must be paid in the event of a lay-off but

the employee must have worked for at least three years in order to qualify. Thailand

requires between 30 days and six months' wages for employees terminated without cause,

the amount depending on length of service, and also requires a notice period. Taiwan

requires one month severance pay per year of service while Malaysia also has specific

amounts and procedures based on the circumstances surrounding a termination.

Cambodia is in line with these requirements as the labor law requires severance pay

based on length of service. This ranges from seven days up to a maximum of six months

salary depending on length of service. Unfortunately, there are also unrealistic

requirements held over from the past. For example, the new Labor Law also requires

that during a notice period prior to termination (which can be as long as three months

depending on length of service) the employee is entitled to two days paid leave per

week in order to look for another job. It is doubtful that this is either implemented

or enforced.

Maternity Leave

Requirements for maternity leave are also widespread throughout the region. Women

in Thailand are entitled to 90 days maternity leave with up to 45 days of that leave

on full pay. In Taiwan, women receive up to eight weeks maternity leave, all at full

pay if they were employed at least six months. Cambodia requires a 90 day maternity

leave during which the employee receives half salary if she has worked for at least

one continuous year.

The Cambodian maternity leave provisions require an employer to allow one additional

hour break during the day, in addition to normal break periods, for breast feeding

for one year after the delivery. This requirement does not appear to be enforced.

Additionally, employers with at least 100 women employees must either provide a nursing

room and child care center for babies or pay for child care if such a facility cannot

be installed.

It is unfortunate that some parts of the new Labor Law have been taken intact from

the previous law which represented an employment policy meant for a socialist-style

labor system. By keeping as part of the law provisions that are not enforced and

will probably never be enforced, it lessens respect for the remainder of the Labor

Law. A failure to enforce in one area can encourage employers to ignore other areas

of the law, as well as allowing employers to pick and choose what aspects of they

law they choose to obey. It also discourages employees who do not know what their

rights are since some are clearly only "paper rights" without any meaning

in the real world of work and employment practices. It would be more helpful, for

both workers and their employers, to enact laws that are more practical and which

will be meaningfully enforced. The alternative is to encourage disrespect for the

Labor Law.

- Roberta Thami is an attorney associated with Dirksen, Flipse, Doran &

Le, an international law firm with regional offices and affiliates in Vientiane,

Phnom Penh and Ho Chi Minh City.

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