Today I wish to discuss about rules governing renewal of fixed-term employment contract in Cambodia. I have reviewed the Labor Law of Cambodia and found that there are 3 rules which are of importance for discussion. The first rule is regulated in Article 67 at paragraph 2, the second one is in the same Article at paragraph 8, and the third one is in Article 73 at paragraph 5.
After reading these rules ￼, I view that Article 67, paragraph 2 and Article 73, paragraph 5 are related and should be discussed together as follows.
Article 67, paragraph 2 reads:
The labor contract signed with consent for a specific duration cannot be for a period longer than two years. It can be renewed one or more times, as long as the renewal does not surpass the maximum duration of two years.
Based on the rule above, the period of the initial fixed-term contract cannot be longer than 2 years. The contract can be renewed several times as long as the period of the total renewals, excluding the period of the initial contract, does not exceed 2 years. The maximum period of fixed-term contract, including initial and renewal, must not exceed 4 years.
While the renewal is allowed under Article 67, paragraph 2 as mentioned above, the renewal of the contract must be conducted in compliance with the rule stipulated in Article 73, paragraph 5 of the Labor Law which reads:
If the contract has a duration of more than six months, the worker must be informed of the expiration of the contract or of its non-renewal ten days in advance. This notice period is extended to fifteen days for contracts that have a duration of more than one year. If there is no prior notice, the contract shall be extended for a length of time equal to its initial duration or deemed as a contract of unspecified duration if its total length exceeds the time limit specified in Article 67.
Therefore, if the employer wishes to renew the contract, the employer must inform the worker 10 days in advance if the period of the contract is more than 6 months. The employer must inform the worker of renewal 15 days in advance if the period of contract is more than 1 year. It is important that the parties need to sign renewal contract having the same or different conditions or period. If the period of the renewal contract does not exceed 2 years, the contract is still fixed-term contract. However, if the period of renewal is more than 2 years, the fixed duration contract is converted to undetermined duration contract.
If the employer fails to provide notice of non-renewal or renewal, the contract will be renewed for the same period. In this case, the parties still need to sign new contract for the said renewal contract to keep the status of employment contract as fixed-term contract.
If the duration of the contract has the duration less than or equal to 6 months, the Labor Law does not require the employer to inform the worker about the renewal or non-renewal of the contract in advance. However, if the parties wish to continue their contract and wish to keep the status of the fixed-term contract, they need to sign the new contract. If the period of renewal exceeds 2 years, fixed-term contract will be transformed to undetermined duration contract.
What happens if the parties do not sign new contract while their employment relation continues after the expiry of the initial contract? Article 67, paragraph 8 can answer to this question. Article 67, paragraph 8 reads:
When a contract is signed for a fixed period of or less than two years, but the work tacitly and quietly continues after the end of the fixed period, the contract becomes a labor contract of undetermined duration.
Accordingly, if the parties continue their employment relation after the expiry of their initial contract without signing new contract, the fixed-term contract is converted to undetermined duration contract.
In conclusion, renewal of fixed-duration contract must be made in written contract and must ensure that the period of renewal does not exceed 2 years. Failing which, the fixed-term contract is converted to undetermined duration contract.
This text is not legal opinion or advice.