Employer of Record in Cambodia

Businesses can only operate smoothly in Cambodia if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Cambodia below, to avoid any compliance issues.

Employment Contract Requirements

In Cambodia, employment contracts can be for a fixed or indefinite term and are typically written in Khmer. These contracts cover important details like:

• Compensation
• Job description
• Start and end date
• Termination requirements

Onboarding Process

We can help you get a new employee started in Cambodia quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations. For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.

Working Hours in Cambodia

Normal working hours cannot exceed 8 hours or 48 hours per week . An employee who works 8 consecutive hours are entitled to a one-hour lunch break.

Overtime in Cambodia

Overtime is restricted to a maximum of two hours per working day beyond the regular eight hours.

• Employees who work overtime during normal working hours are entitled to receive overtime pay at a rate of 150% of their regular hourly wage.
• For those engaged in permanent or shift work between 10:00 pm to 5:00 am (this is regarded as Night Work), the overtime pay rate is set at 130% of their normal pay rate.
• The employer is entitled to provide the employee with accommodation and transport.
• Over-time worked on public holidays and weekly time off is paid at a rate of 200%

Probation Period in Cambodia

In Cambodia, the maximum probation period is limited to three months. It cannot be extended beyond this period.

• Regular employee = 3 months
• Specialized employee = 2 months
• Non-specialized employee = 1 months

Fiscal Year in Cambodia

1 January - 31 December is the 12-month accounting period that businesses in Cambodia use for financial and tax reporting purposes.

Payroll Cycle in Cambodia

The payroll cycle in Cambodia is usually monthly, with employees being paid on or before the last day of the month.

Minimum Wage in Cambodia

The minimum wage for employees in Cambodia is typically 5,118 KHR per hour, amounting to ~818,800 KHR per month for a typical 40 hour work week.

Bonus Payments in Cambodia

In Cambodia, there is no statutory requirement for a 13th-month salary.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 5.4% on top of the employee salary in Cambodia.

Employee Payroll Tax Contributions

In Cambodia , the typical estimation for employee payroll contributions cost is around 2%.

Individual Income Tax Contributions

In Cambodia, individual income tax is calculated based on progressive rates ranging from 0% to 20% as follows:

Pension in Cambodia

Companies with employees must register with the National Social Security Fund (NSSF). To get pension benefits, one must be at least 60 years old, registered in the NSSF pension scheme, and have contributed for at least 12 months. Pension contributions are based on monthly earnings, capped at KHR 1,200,000.

In Cambodia, work permits and visas are essential for employers hiring foreign workers. The process involves submitting applications, paying fees, and meeting specific eligibility criteria. The key visa types include the Ordinary (E) Visa, Business Visa, and Investor Visa. Employers must ensure compliance with local labor regulations when sponsoring foreign employees.

Mandatory Leave Entitlement in Cambodia

The annual leave entitlement in Cambodia is 18 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays In Cambodia

The number and dates of paid public holidays in Cambodia are determined annually by a Prakas issued by the Ministry of Labor.

Paid Time Off in Cambodia

In Cambodia, employees earn 1.5 days of paid vacation for every month they work at a company, with a maximum cap of 18 days off per year. They also get an extra day off every three years, and there's room for negotiating longer annual vacations through collective agreements.

Maternity Leave In Cambodia

Female employees in Cambodia are entitled to 90 days of paid maternity leave at 50% of their regular salary rate if she has been employed for one year of service. They also receive two paid nursing breaks of 30 minutes each working day until the child reaches the age of 12.

Paternity Leave In Cambodia

There is no paid statutory paternity leave. However, male employees can utilize their annual leave entitlement for paternity leave, with a maximum duration of up to seven days.

Sick Leave In Cambodia

Employees can take up to six months of sick leave with a medical certificate. During the first month, they receive 100% of their salary, followed by 60% for the next two months. The remaining sick leave is unpaid. If the leave exceeds six months, the employer can choose to terminate the employee, depending on internal policies.

Parental Leave In Cambodia

There is no additional or separate parental leave policy beyond maternity leave in Cambodia.

Bereavement Leave

Employees are entitled to seven days of unpaid leave in the unfortunate event of the death of an immediate family member.

Wedding Leave

Employees can take seven days of unpaid leave for their own wedding.

Termination Process in Cambodia

Dismissal in Cambodia is required to be justified, especially when it results from an employee's failure to meet reasonable performance standards communicated by the employer. Some of the reasons that may lead to termination include:

• Misconduct
• Breach of contract
• Poor performance
• Mutual agreement

Notice Period in Cambodia

The termination of an employment contract requires a justifiable reason, and the employer is obligated to provide notice to the employee. The notice period varies depending on the length of the employee's service:

• Seven days of notice for employees with six months or less of service.
• Fifteen days of notice for employees with 6 to 24 months of service.
• One month of notice for employees with 2 to 5 years of service.
• Two months of notice for employees with 5 to 10 years of service.
• Three months of notice for employees with more than ten years of service.

Severance in Cambodia

In Cambodia, severance payments are required to be at least 5.00% of the total wages paid to the employee over the duration of their contract. For employees with no fixed contract duration:

• If they worked between 6 months to 1 year, severance is seven days of regular salary.
• If they worked more than a year, it's 15 days of regular salary for each year, up to a maximum of 6 months' salary and benefits.