Employer of Record in Cambodia

Hiring independent contractors has boomed in popularity because of the cost savings and flexibility they offer. It can be a great option if you require niche skills or short-term project support. Contractors allow businesses to access specialized skills quickly, without the time and cost of setting up a local entity.

However, it’s important to know the limits of this model: contractors are not a substitute for full-time employees. Relying on them for ongoing, long-term roles can create serious compliance risks, including employee misclassification, which can lead to fines, back taxes, and reputational damage.

Playroll’s contractor management solutions make it simple to compliantly engage, onboard, and pay contractors around the world. We provide clear visibility into agreements, streamline payments, and reduce compliance risks – so you can focus on getting the work done. And when you’re ready to take the next step, we can help seamlessly convert contractors into full-time employees through our global Employer of Record service.

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

In Cambodia, you should plan carefully around daily overtime caps and obtain employee consent where required. As enforcement continues into 2026, scrutiny remains high on overtime limits, night work classification, and record accuracy.

• Standard Working Hours: Up to 8 hours per day and 48 hours per week.
• Overtime Thresholds: Overtime is limited to 2 hours per day.
• Overtime Pay Rates: Commonly 150% for normal-day overtime and 200% for night or rest-day overtime.
• Daily And Weekly Rest Requirements: Rest and meal breaks must be preserved and recorded.
• Night Work Restrictions: Night hours are typically 22:00–05:00 and attract higher premiums.
• Penalties For Non-Compliance: Enforcement action may include corrective orders and wage recovery.

As of January 1, 2026, Cambodia’s minimum wage for workers in the textile, garment, footwear, travel goods, and bag sectors is set at USD 210 per month for regular employees, which is approximately KHR 845,000–850,000 per month. This represents a modest increase from the 2025 minimum wage of USD 208 (about KHR 836,000) and reflects the government’s annual wage review process aimed at improving workers’ living standards while maintaining the competitiveness of Cambodia’s manufacturing industries.

Cambodia’s minimum wage system primarily applies to these export-oriented sectors, which employ a large share of the formal workforce. While there is no uniform national minimum wage across all industries, the garment and related sector minimum wage continues to serve as a key benchmark within the broader Cambodian labour market.

Hiring in Cambodia means navigating local labor laws, mandatory employee benefits, payroll taxes, and strict employment regulations. These requirements aren’t always intuitive, especially if your team lacks in-country legal or HR expertise. An Employer of Record steps in as the legal employer for your hires, managing all compliance-related responsibilities. This includes issuing locally compliant contracts, registering employees with relevant authorities, processing payroll, and handling social security contributions and taxes in line with national laws.

By handing over these complexities to an EOR, your business avoids costly compliance errors and the time required to master local employment standards. You can focus on growing your team and operations while trusting that the legal and administrative foundation is solid. Whether you're making one strategic hire or building out an entire team, the EOR keeps you compliant, removes guesswork, and reduces the risk of legal or financial penalties, without requiring you to open a legal entity or maintain a local HR team.

Setting up payroll in Cambodia requires getting several registrations and systems in place to stay compliant. Businesses must register with the General Department of Taxation (GDT) and enroll their employees in the National Social Security Fund (NSSF). Salary tax in Cambodia is progressive – income under KHR 1,300,000 may be exempt, while the rest is taxed at rates ranging from 5% to 20%, depending on the bracket.

Employers also have their own tax and contribution obligations beyond employee income tax. They must pay employer contributions – typically about 5.4% of each employee’s salary – toward the NSSF and other statutory funds. Employees contribute around 2% from their salary to cover their share of NSSF and other payroll-related taxes. Together, these payments fund benefits such as healthcare, pensions, and insurance.

Using payroll management software can help employers streamline compliance, consolidate payroll data, and avoid costly penalties in Cambodia.

Running payroll in Cambodia is complex, especially when you're hiring without a local entity. Local laws determine everything from tax withholdings and reporting deadlines to benefit contributions and currency requirements. Missteps can lead to fines, payment delays, or unhappy employees. An Employer of Record takes this burden off your plate by handling the full payroll process. Acting as the legal employer, the EOR ensures you remain compliant with all payroll-related obligations, while still allowing you to manage your team’s day-to-day work and performance.

Key Ways an EOR Supports Payroll in Cambodia:

• Compliance Assurance: Ensures payroll aligns with local tax laws, labor regulations, and statutory deadlines.
• Payroll Processing & Tax Management: Calculates salaries, applies correct tax withholdings, and submits required reports.
• Benefits & Social Security Contributions: Manages employer obligations for pensions, health insurance, and other legal entitlements.
• Contract Generation & HR Administration: Drafts compliant employment contracts and supports onboarding, terminations, and HR tasks.
• Currency Payments: Issues timely salary payments in local currency, ensuring employees are paid accurately and on time.

In Cambodia, foreign nationals who wish to work legally typically enter on an E-class (Ordinary) visa and then obtain a Cambodian work permit and employment card issued through the Ministry of Labour and Vocational Training (MLVT). The work permit is tied to a specific employer and role, and must be supported by the company’s valid registration and tax status.

Employers are expected to register their foreign staff with the MLVT and, in many cases, with the General Department of Immigration for residency and address reporting. Work permits are usually granted for up to one year and can be renewed, provided the employment relationship continues and both the employer and employee remain compliant with Cambodian labor, tax, and immigration rules.

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.

Employee benefits in Cambodia combine a core set of statutory protections with a growing market for supplemental perks, especially in multinational and professional-services environments. To hire successfully, your company needs to comply with mandatory benefits such as social security and paid leave, while using additional benefits strategically to compete for talent.

The legal framework is relatively clear, but many rules are interpreted through practice and ministerial guidance, so working with a knowledgeable local partner or counsel is important. Once you understand which benefits are compulsory and which are discretionary, you can design a package that balances compliance, cost control, and employee expectations.

• Key mandatory benefits: National Social Security Fund (NSSF) schemes for occupational risk, health care, and pensions; paid annual leave; paid public holidays; paid maternity leave; and sick leave tied to medical certification.
• Key supplemental benefits: Private health insurance and top-up medical cover; bonuses and performance-based incentives; and meal, transport, or housing allowances.
• Legal and tax considerations: Employer registration with NSSF and timely contributions; correct treatment of taxable vs non-taxable benefits under Cambodian tax law; and robust documentation (payroll records, leave records, employment contracts, and invoices) to support compliance in case of audits.

Administering employee benefits in Cambodia requires more than just offering a standard package. Local labor laws often mandate specific entitlements, from health insurance to paid leave, and the rules can change without warning. Cambodia also has unique standards for what an attractive, competitive benefits package looks like. For businesses without in-country expertise, meeting these obligations and expectations can quickly become risky and expensive. An Employer of Record acts as your compliance partner, ensuring all benefits are provided according to the latest legal requirements and without administrative strain on your internal team.

Beyond compliance, an EOR brings clarity and consistency to a process that’s often complex and fragmented. They handle enrollments, ensure accurate employer contributions, manage communications with local providers, and keep everything properly documented. This means employees get what they’re entitled to, and you avoid the headache of navigating benefits systems in a foreign market. Whether you're hiring one person or building a larger team, an EOR provides a clear, dependable structure that lets you offer competitive benefits without taking on unnecessary risk or workload.

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.