The Ministry of Labour and Vocational Training on Friday announced a plan to oblige all enterprises under its oversight to pay workers’ and employees’ salaries twice a month starting from January next year.
According to the Prakas, signed by Labour Minister Ith Sam Heng, employees will get half of their salary in the second week and the remaining half together with other incentives and benefits in the fourth week of each month.
Cambodian Alliance of Trade Unions (CATU) president Yang Sophorn said paying workers twice a month has both positive and negative effects.
“It has a positive effect because workers wouldn’t have to take out a loan anymore when they are short. In the past, they would borrow money from others and payback when they get paid."
“But it would also be difficult for them to save money. It’s not something they have demanded. In fact, [the new payment scheme] is in accordance with labour law,” he said.
Meanwhile, the ministry will also implement a seniority indemnity two times a year, starting next year.
The prakas said the seniority indemnity shall apply only to workers/employees who have undetermined duration contract as stipulated under Article 89 of the labour law.
For workers who have a fixed duration contract, the employer shall provide the workers/employees with severance pay which is in proportion to both wage and the duration of the contract.
The amount of this severance pay is stipulated in the collective bargaining agreement. If there is no collective agreement, it shall be at least five per cent of the wages that the workers/employees have been paid during the duration of the contract.
The employer shall provide workers/employees who are working with seniority indemnity equal to 15 days of their wage and other benefits per year. This indemnity shall be paid to workers/employees seven and a half days in June of each year and seven and a half in December of each year.
For workers/employees who have been employed in the first year and have worked consecutively from one to six months, the employer shall provide the workers/employees with seven and a half days of seniority indemnity.
The seniority indemnity back pays of workers/employees who have been working in the enterprise/establishment shall follow certain formalities.
For textile, garment and footwear enterprise/establishment, the employer shall pay back pay of 30 days of the total seniority indemnity every one year, 15 days in June of each year and 15 days in December of each year.
For enterprise/establishment other than the textile, garment and footwear sector, the employer shall pay back pay of 15 days of the total seniority indemnity every one year, seven and a half days in June of each year, and seven and a half days in December of each year.
The maximum seniority indemnity to be paid shall not exceed six months of the average net wages of each year.
For the first year of employment of workers/employees, which is the basis for seniority indemnity, the employer shall pay seniority indemnity of seven and a half days to workers/employees who have worked consecutively from one month to six months.
If the employment duration exceeds six months, it shall be equal to one full year and the employer shall pay seniority indemnity of 15 days to the workers/employees.
Workers/employees who have seniority before 2019 from one month upwards will receive two different types of seniority indemnity, back pay of seniority before 2019 and seniority indemnity in each year. Workers/employees who resign will not receive the back pay of the remaining seniority.
Labour Ministry spokesman Heng Sour could not be reached for comment. But Sophorn said more needs to be done for the benefit of workers.
“Regarding seniority indemnity, I think [the minister] may want more support from workers."
It’s not certain if the prakas will provide more advantages for workers than before because it would be just a small contribution.
“As a matter of fact, the government should check companies that use short-term contracts because short-term contracts could lead to an abuse of workers’ rights,” he said.