Cambodian Labor Law: What is Wage?

It is of great importance to define wage and other benefits that are not categorized as wage. This is because understanding the wage will help parties to calculate wage, indemnity, compensation for certain circumstances that will be discussed further below.

Article102 of the Labor Law provides that for the purposes of the Labor Law, the term”wage”, irrespective of what the determination or the method of calculation is, means the remuneration for the employment or service that is convertible in cash or set by agreement or by the national legislation, and that shall be 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. Accordingly, “wage” is the award or grant given by the employer as a consideration for the performance of labor or service by the worker according to agreement or laws.

Under Article 103 of the Labor Law, wage includes, in particular, (1) actual wage or remuneration; (2) overtime payments; (3) commissions; (4) bonuses and indemnities;(5) profit sharing; (6) gratuities; (7) the value of benefits in kind; (8) family allowance in excess of the legally prescribed amount; (9) holiday pay or compensatory holiday pay; (10) amount of money paid by the employer to the workers during disability and maternity leave. Wage does not include (1) health cares; (2) legal family allowance; (3) travel expenses; (3) benefits granted exclusively to help the worker do his or her job.

The arbitration council views that the elements that make up “wage” are not necessarily limited to the items described in Article 103 of the Labor Law. (Arbitration Council Case No. 83/08) Article 103 lists the elements that can be included in wage but does not require employers to pay all these elements to workers. Employers have the obligation to pay one or more of these elements in accordance with the agreement of both parties or laws. (Arbitration Council Case No. 168/16)

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