Minimum Wage
In accordance with the provisions of the Labour Code 1997, workers' salaries must at least be equal to the minimum wage, ensuring every worker a decent standard of living consistent with the human dignity.
Minimum wage rate is set by Ministry of Labour and Vocational training in consultation with Labour Advisory Committee through Prakas (Ministerial Orders). Minimum wage rates must be set without any distinction on the basis of professions or jobs. However, minimum wages may vary according to the region, depending on the economic conditions and cost of living. Same factors are considered while adjusting the minimum wage. Minimum wage is determined by considering the needs of workers and their families in relation to the cost of living, social security allowances, general level of wages in the country and the comparative standard of living of other social groups. Requirements of economic developments, productivity and achieving and maintaining high level of employment are also taken into consideration while determining minimum wage.
The minimum wage for piece-rate employees in the garment, textile and footwear industries is also the same as regular employees. In case, it is less than the above referred minimum wage, employer has to add the remaining amount to make it equivalent to the minimum wage.
Workers are also entitled to seniority bonus after first year of service, ranging from USD2-11 per month, equal to the year of service except those who have seniority beyond 11 years, they receive seniority bonus of the 11th year, i.e., USD11 per month. The other bonuses include attendance bonus, health care allowance, and housing/transportation allowance.
The 2018 Law on Minimum Wage provides for a National Council on Minimum Wage (a tripartite body with equal representation from all partners) with the following responsibilities: conducting scientific study on minimum wages; recommend minimum wage rates to the Ministry; and disseminate and raise awareness and promote social dialogue on minimum wage.
The key factors in determining the minimum wage include inflation rates, living expenses, productivity, competition, job market status and profitability of a particular industry. The Council is required to discuss minimum wage levels every year. Once the Council recommends a minimum wage rate, the declaration is issued by the Ministry of Labour and Vocational Training through Prakas.
Failure to provide a minimum wage may subject an employer to a fine of up to KHR 40,000,000. In the case of payment lower than the specified minimum wage, employers are required to pay back the full amount to such workers as well as the interest at a rate applicable by law.
An employer who fails to pay wages at least equal to the guaranteed minimum wage is liable to a fine of 61-90 days of base daily wage or to imprisonment for between six days and one month. The daily base wage is the minimum wage set by the government by ministerial order. Joint Prakas No. 659 specifies such daily base wage as 40,000 riels.
Sources: §104 & 107 of the Labour Law, promulgated by Royal Order No. CS/RKM/0397/01 of 13 March 1997 (amended in 2021); Joint Prakas No. 659 Dated 06 June 2016; Law on Minimum Wage 2018
For updated minimum wage rates, please refer to the section on minimum wage.
Regular Pay
Wage is the remuneration for the employment or service and is payable in cash as set by agreement or by the national legislation, and is given to a worker by an employer, by virtue of a written or verbal contract of employment or service, either for work already done or to be done or for services already rendered or to be rendered.
The term "wage" includes, in particular actual wage or remuneration; overtime payments; commissions; bonuses and indemnities; profit sharing; gratuities; the value of benefits in kind; family allowance in excess of the legally prescribed amount; holiday pay or compensatory holiday pay; and the amount of money paid by the employer to the workers during disability and maternity leave. The following items are however not included in wage calculation: health care expenses; legal family allowance; travel expenses; and benefits granted exclusively to help the worker perform his/her job.
Employers are required to inform the workers in a precise and easily comprehensible fashion the wage related terms before they are assigned to a job or at any times these terms change and the items that make up their wage for every pay-period when there is a change in the items.
For piecework or product work that is to be executed for longer than fifteen days, the dates of payment can be fixed by agreement however the labourer must receive partial payments every fifteen days and be paid in full in the week following the delivery of the work. In the event of contract termination, wage and indemnity of any kind must be paid within forty-eight hours following the date of termination of contract. In case of an unjustified delay in the payment of wages, the Labour Inspector shall serve notice on the employer to pay the wage of his workers by setting the deadline by which payment must be made. Employers are prohibited from restricting the worker's freedom to using wages at his/her own disposal.
In accordance with the Labour Code, an employer is obliged to pay wages at least twice a month, in sixteen (16) day intervals to the labourers (who are involved in manual labour); or at least once a month to the employees; or within a week on delivery of wok for piecework. Commissions of sales representatives must be settled at least once every 3 months. Wages are paid in cash, directly to the workers (unless agreed otherwise) on working day at or near the workplace. The employer must pay in advance, if payment day falls on a holiday. In accordance with the Prakas On Wage Payment for Workers/Employees, all employers must pay the employee salaries twice every month. First payment, 50% of the monthly wage, is received during the second week of month. The second payment, remainder of monthly wage, is paid at the end of fourth week of the month.
Generally, employer is not allowed to deduct wages except to pay for the actual cost for tools and equipment that the employee does not return; or the items and materials under the control and usage of the employee; or the amounts owed to the company store, provided that the amount deducted from an employee's wages must not cause the employee to take home less than the minimum wage. Employer can also make deductions for payment of union dues by the union members. Collective agreements authorizing any wage deductions other than these cases are null and void.
Deduction of wages is prohibited in exchange for job placement; or if worker refuse to eat at company's canteen; or to punish them for misconduct or refusing to work overtime; or charge employees more than the real cost of replacing lost ID cards; or charge employees any amount for the mandatory medical checks.
An employer should provide pay slips to all employees on each pay day. These pay slips should be in Khmer and show the calculation of wages along with items.
Sources: §102-133 of the Labour Law, promulgated by Royal Order No. CS/RKM/0397/01 of 13 March 1997 (amended in 2021); §1 of Prakas On Wage Payment for Workers/Employees (MoLVT No: 442 K. B/Br.K. Kh)
