Cambodia: unfair dismissal

What is considered unfair dismissal? What are the remedies available to the dismissed worker? This article will answer to these questions.

Dismissal refers to termination of employment contract at the initiative of the employer. Under the Labor Law of Cambodia, unfair dismissal refers to termination of contract which is taken by employer without a reasonable ground or a valid reason. Article 74, paragraph 2, of the Labor Law of Cambodia reads:

However, no layoff [dismissal] can be taken without a valid reason relating to the worker’s aptitude or behavior, based on the requirements of the operation of the enterprise, establishment or group.

Based on the above provision of the Labor Law, we can say that the Labor Law does not define the term “valid reason” or what constitutes a valid reason for dismissal. However, the Labor Law does provide types or categories of valid reason. Article 74, paragraph 2, of the Labor Law of Cambodia adopted in 1997 resembles Article 4 of ILO Convention (No. 158) on Termination of Employment adopted in 1982, which does not define the term “valid reason” but it provides types of valid reason and list of grounds prohibited for dismissal.

Article 4 of the ILO Convention (No. 158) reads:

The employment of a worker shall not be terminated unless there is a valid reason for such termination connected with the capacity or conduct of the worker or based on the operational requirements of the undertaking, establishment or service.

According to above provisions, there are three main types of valid reason for dismissal, namely:

  • reason related to workers’ aptitude,
  • reason related to worker’s conduct, and
  • reason related to the requirements of the operation of the enterprise, establishment or group.

We now examine each of type of valid reason for dismissal.

First types of valid reason for dismissal relates to worker’s aptitude. It would be unreasonable to dismiss the worker by just relying on poor performance, absence from work due to sickness or injury. However, it would be a reasonable to dismiss worker based on the ground of worker’s remarkably poor capacity without hope of improvement, long-term or repeated sickness or injury. As long as employer can prove that dismissal is the last resort to deal with concerned worker after the employer has taken other measures such as providing opportunity for training or education to poor-capacity worker, suspension of employment contract for a period up to 6 months in the event of long-term sickness or injury of the worker, we can say that the dismissal is taken with valid reason. (Read more Dismissal on ground of sickness and Is poor performance a misconduct?)

Second type of valid reason for dismissal relates to worker’s behavior or conduct. Depending on level of its seriousness, misconduct is subject to disciplinary action, such as verbal or written warning, suspension of employment contract without payment or dismissal. According to the principle of proportionality in Article 27 of the Labor Law of Cambodia, serious misconduct is reasonable ground for dismissal. Dismissal on the ground of serious misconduct may be called disciplinary dismissal. Examples of serious misconducts are stealing, misappropriation, embezzlement, fraud, insult, assault, inciting other worker to commit serious offense, serious infringement of internal regulations of the company, political propaganda, demonstration or activities in the workplace or enterprise. (Read more Cambodia: Serious misconduct of worker)

Third type of valid reason for dismissal relates to the operational need of the enterprise, establishment or group. It is the case where it is necessary for the employer to lay off the worker due to reduction of work, reorganization or closure of operation or business of the enterprise or establishment. Dismissal in this case is also called economic dismissal or adjustment dismissal. In addition to requirement of presenting valid reason for dismissal, employer has to comply with procedural rules of Article 95 of the Labor Law.

According to this Article 95, the employer must reasonably select the worker for layoff in consideration to professional qualification, seniority and family burden of the worker. That means that the first worker to be laid off is the one who has less qualification, seniority and family burden. In addition, the employer must notify the workers’ representatives in writing to solicit their suggestion on the measure for a prior announcement of reduction in workers and measure taken to minimize the effect of the reduction on the affected workers. Furthermore, employer must keep notifying the labor inspector of all procedures and participating in meetings one or more time to examine the impact of the proposed layoff and measure to be taken to minimize their effects, whenever the labor inspector calls for such meeting pursuant to request of workers’ representative. The employer must suspend the layoff for a period not more than 30 days if there is Prakas from the Minister in charge of Labor to find solution. The Minister also can extend the suspension of employment for other 30 days. (Read more Employment Contract in Cambodia)

The remedy for dismissal without valid reason is compensation on damage (Article 91-New of the Labor Law) or reinstatement to the workplace with back-payment if the employment relation is restorable or repairable (Article 385 of the Labor Law). Other than dismissal due to serious misconduct, the dismissed worker is also entitled to get the remaining seniority indemnity. (Read more Seniority Indemnity Payment in Cambodia)

This text is not legal advice.

Categories Employment and Labor Laws

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