Logo of Phnom Penh Post newspaper Phnom Penh Post - Seniority payments delayed

Seniority payments delayed

Content image - Phnom Penh Post
Garment and footwear industries hold bigger risks, given that factories and assets can easily be moved to other countries, Labour Ministry spokesperson Heng Sour has said.Post pix

Seniority payments delayed

The Ministry of Labour and Vocational Training has postponed seniority indemnity payments for non garment and footwear workers until 2021, it said in a statement.

“Seniority payments” replaced Cambodia’s previous system of “indemnity for dismissal” payments – a legal concept requiring employers to give employees severance pay if their contracts are terminated – at the start of this year.

The amendment was stipulated in Prakas 443 – released by the ministry on September 21 last year – which dictates that an employer is no longer required to indemnify an employee who is dismissed but will be required to pay seniority payments every six months, equivalent to 15 days of the employee’s pay.

The first payment was expected to occur in June of each year, and the second payment in December.

However, the latest ministry directive states that only workers in the garment and footwear sectors would receive the senior indemnity back pay from this year onwards.

“During the postponement, employers must pay seniority payments immediately for workers, or their relatives, who were laid off for less serious reasons, retirement or death,” the statement read.

It further said: “The workers who have resigned from their jobs spontaneously or been laid off due to serious mistakes shall not receive the seniority indemnity back pay prior to 2019.”

Speaking to The Post on Sunday, ministry spokesperson Heng Sour said “the garment and footwear industries are universal and hold bigger risks, given that factories and assets can easily be moved to other countries”.

“Whereas in other sectors, the assets – as universally viewed by economists – cannot be easily moved. Employees and the government alike are less likely to face bankruptcy if the business owners run away. Therefore, the payments of seniority indemnity back pay from before 2019 for industries outside the garment and footwear sectors have been postponed until 2021,” Sour said.

Moeun Tola, the executive director of the Centre for Alliance of Labour and Human Rights (Central) echoed similar remarks.

He said he was not worried about the announcement of the delay, noting that “non garment and footwear sectors rarely hold risks as long as the enterprises fully abide by the law”.

However, he fretted about the garment and footwear sectors, stressing that “vulnerable sectors are prone to risk should the implementation of seniority payments become unclear”.

“There must be seniority payments upon termination of a contract between companies and workers. The new law [Prakas 443] is good because it gradually indemnifies the employees. However, if it was implemented with the intention to reduce their seniority then it would make dismissal by employers easier,” Tola said.

Keo Mom, director-general of Ly Ly Food Industry Co Ltd, lauded the delay, saying it would ease “some burdens on them”.

“We are happy to follow the government’s direction. However, some small enterprises still find difficulties in indemnifying their workers. Therefore, we hope the ministry would give us more time,” she said.

MOST VIEWED

  • Website advises travellers to stay clear of Angkor Wat

    An Australian website has advised travellers to avoid Angkor Wat during their trip to Southeast Asia because the ancient temple is showing signs of rapid erosion and faced water management issues. In a recent article entitled Best places to go in 2020: 12 destinations you should avoid

  • First deportees of the year touch down in Cambodia

    Twenty-five Cambodian-Americans landed in Phnom Penh on Wednesday, marking the first such deportations of the year. “On Wednesday, US law enforcement authorities deported 25 Cambodian nationals that immigration judges determined had no legal basis to remain in the US,” said Arend Zwartjes, spokesperson for the US

  • Passenger taxi boat ridership sinks despite free services

    Passenger taxi boat traffic has dropped by about five per cent compared to the same period last year, despite the government providing free service for garment workers until next year, Phnom Penh Autonomous Bus Transportation Authority director Ean Sokhim said on Monday. In 2018, the Phnom

  • Shipments of mango to South Korea poised to begin this week

    Exports of Cambodian mangoes to South Korea will begin this week after Korean authorities gave the nod. The Ministry of Agriculture, Forestry and Fisheries’ Department of Plant Protection, Sanitary and Phytosanitary Requirements director Ker Monthivuth told The Post on Sunday that after several inspections of

  • Kingdom drafting new law to strengthen immigration

    The Ministry of Interior on Tuesday said it had formed a working group to draft amendments to the Law on Immigration. Its secretary of state Sok Phal told The Post that the amendments will strengthen the management of immigrants in line with the current situation.

  • Jica seeks to turn PP, towns into smart cities

    Japanese International Cooperation Agency (Jica) representatives have sought support from Siem Reap’s Apsara National Authority (ANA) to transform the ancient capital into a smart city. The call was made in February last year after the government approved three cities to join the Asean Smart