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Compliance
Cambodia's employment system is governed primarily by the Labor Law of 1997 and its amendments. The Ministry of Labour and Vocational Training (MLVT) is the main enforcement authority, overseeing labor inspections, registration of enterprises, and issuance of work permits. Employers must ensure full compliance with national labor standards including occupational safety, minimum wage laws, and employment contracts.
Employment contracts in Cambodia are categorized into fixed-duration contracts (FDC) and undetermined-duration contracts (UDC). Contracts must be in writing, in Khmer language, and include job duties, wages, location, and contract duration. UDCs provide greater employee protection and are presumed when no clear duration is defined. A copy of each contract must be submitted to the MLVT for official registration.
The maximum legal working time is 8 hours per day and 48 hours per week. Overtime must be authorized and compensated at 150% for weekday hours, 200% on weekends or public holidays, and 300% at night. Employees are entitled to a weekly day of rest and a daily break. Employers are required to maintain detailed time records and provide these during labor inspections.
Minimum wage applies primarily to the garment and footwear sectors and is revised annually. As of 2025, the minimum wage is set at USD 204/month. Employers must pay wages twice a month and issue detailed payslips. All salary payments must be made in local currency (KHR), unless exceptions are authorized. Failure to comply may result in fines and revocation of business licenses.
Employers must register employees with the National Social Security Fund (NSSF), covering occupational risks, health insurance, and pensions. Contributions are calculated based on gross wages, with employers responsible for a significant portion. Late contributions incur penalties and interest. Registration is also required within 15 days of hiring a new employee.
Foreign workers must obtain a work permit and employment card from MLVT. Before applying, employers must receive quota approval allowing them to hire foreign employees, which is typically capped at 10% of the workforce. Work permits are valid for one year and must be renewed annually. Employers hiring without proper authorization may be fined or banned from future foreign hiring.
Termination must follow Cambodia’s defined procedures. For FDCs, termination before expiration requires mutual consent or a justified cause. UDCs require prior notice (from 7 to 60 days depending on length of service) and severance. Employers must pay indemnity for dismissal without cause, as well as unused annual leave, seniority payments, and other end-of-service benefits.
The MLVT facilitates mediation and arbitration of labor disputes. Employers may be subjected to inspections to verify compliance with safety standards, documentation, and wage laws. Non-compliance can lead to warnings, administrative fines, and suspension of operations. Repeat offenses are treated as criminal violations.
AYP helps international and local businesses navigate Cambodia’s complex employment regulations through comprehensive EOR support. We manage contract compliance, payroll processing, foreign work permits, and social security filings—helping your company avoid legal risks and focus on core operations.
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