Cambodia’s Ministry of Labor and Vocational Training issued the Notification on the Compensation for Terminating an Employment Contract on March 21, 2024, clarifying the compensation due to employees upon the termination of their employment contracts.
The notification outlines different requirements depending on the nature of the termination and the type of employment contract, as laid out below.
Termination without Valid Reason and in Absence of Serious Misconduct
If an employment contract has been terminated by an employer without a valid reason and the employee did not commit any serious misconduct as defined under the relevant article of the Labor Law, the employer must compensate the employee as follows:
Fixed-Duration Contract:
Unspecified-Duration Contract:
Termination in Cases of Serious Misconduct
Employees who commit any serious misconduct as defined under the Labor Law (regardless of whether they are under a fixed-duration or unspecified-duration contract) are entitled only to the following compensation:
Termination Due to Bankruptcy
Since bankruptcy is considered not to affect an employee’s dignity or to lead the public to doubt the employee’s behavior, ability, or productivity, employees whose contracts are terminated for reasons of bankruptcy are not entitled to any damages. Employers are only responsible for making the following compensation:
Fixed-Duration Contract:
Unspecified-Duration Contract:
To learn more about this new notification or any aspect of employment law in Cambodia, please contact Tilleke & Gibbins at [email protected].