Employer of Record in 柬埔寨

How an Employer of Record works in Cambodia

When you use an Employer of Record (EOR) in Cambodia, you can hire employees within the country without having to set up a legal entity. The EOR becomes the legal employer, taking care of onboarding employees, dealing with compliance, and managing the employment relationship.

Rivermate provides EOR services in Cambodia, and our HR experts have a deep understanding of the country. We’ll make it easy to hire quickly and compliantly anywhere in Cambodia.

Cambodia labor market: At a glance

The hiring market
Greatest hiring activity:	Phnom Penh.
Hiring timelines:	4–6 weeks for entry-level roles; 8–12 weeks for senior roles; about three months for foreign nationals.
In-demand sectors:	Manufacturing, tourism, logistics.
Sectors with skills shortages:	Specialist IT and engineering roles.

The salary market
Employer tax contributions:	5.4% of the employee’s wage, capped at wages of KHR 1,200,000 per month. Occupational risk (0.8%) Healthcare (2.6%) Pension (2%)
Minimum wage:	USD 210 for regular workers and USD 208 for probationary workers (only applies to certain industries).
Average gross annual salary:	About KHR 14.4 million.
Income tax brackets:	Up to KHR 1.5m: 0% KHR 1.5m–2m: 5% KHR 2m–8.5m: 10% KHR 8.5m–12.5m: 15% Above KHR 12.5m: 20% Non residents: 20% flat rate

What it costs to hire an employee in Cambodia

Cambodia is known for being a relatively affordable country to hire employees, but there are several important costs you need to know about before entering the country.

Salary

Cambodia has no single minimum wage that covers all sectors. In practice, a statutory minimum applies only to the textile, garment, travel goods, footwear, and bag industries. This is currently USD 210 per month for regular workers and USD 208 for probationary workers. Workers in these sectors also receive extras, including a monthly transport and accommodation allowance of USD 7 and a monthly attendance bonus of USD 10.

The salary ranges considerably. Across all workers, the average monthly wage is about KHR 1.2 million, but this includes informal sector work. You can expect to pay USD 250–500 for an entry-level role up to around USD 2,500–5,000 for a management role.

In practice, salaries are quoted gross. Since 2019, employers have been required to pay employees twice a month, with half of the monthly wage paid in the second week and the remaining half in the fourth week.

The local currency is the riel. However, the US dollar is widely used in the country, and many everyday transactions are even paid in USD. Contracts can reference USD amounts, but contributions and social security must be calculated in riel.

Employer contributions

Employer contributions are quite low in Cambodia. Employers pay 5.4% of the employee’s wage, and this is capped at wages of KHR 1,200,000 per month. It’s made up of occupational risk (0.8%), healthcare (2.6%), and pension (2%). These are paid to the National Social Security Fund (NSSF). Employees also contribute 2% to their own pensions.

Because of the ceiling in place, the most that an employer pays is KHR 64,800 per month for each employee.

Income tax

Employment income is taxed through a monthly salary tax. The employee pays this, and the employer must withhold it. Current monthly rates range from 0% for wages under KHR 1.5m to 20% for wages over KHR 12.5m. Non-residents pay a 20% flat rate for a salary sourced in Cambodia.

Seniority payment

In Cambodia, a seniority payment exists and equals 15 days’ wages plus fringe benefits per year of service. This is only due to employees on undetermined-duration contracts. It’s paid during employment, with half paid in June and half paid in December each year.

When a fixed-term contract ends, you must pay at least 5% of the total wages that were paid during the contract period.

Leave

Cambodian employees receive 18 days of annual leave, equal to 1.5 days per month. They receive one extra day every three years. Although leave accrues monthly, employees can take it only after a full year of service.

Maternity leave is 90 days, and the employer pays 50% of the employee’s wages if the employee has one year of continuous service.

Overtime

Employees receive a 50% premium for overtime on normal days and a 100% premium for overtime at night or on rest days. On holidays, they receive an additional day’s pay.

Employer cost calculator

Use our calculator to get an accurate idea of total employer costs in Cambodia.

What hiring in Cambodia actually looks like

Market condition	What an employer needs to know
Talent availability	Easy to find entry-level and admin staff in cities. Harder to find qualified staff.
Top-paying sectors	ICT and finance.
Skills shortages	ICT, accounting, and healthcare.
Key employer challenge	Finding and keeping skilled employees.

Cambodia has a young workforce, and more than 60% of the population is under 35. There is a growing number of graduates in IT, finance, and business, and English skills tend to be good in urban areas and in the tourism industry, but they are more limited elsewhere.

Manufacturing is the biggest export industry in Cambodia, led by garments and footwear. Tourism is also important, as is agriculture. Multinationals hire mainly in the telecoms, finance, logistics, and FMCG industries. Demand is growing for customer support, along with online operations and data processing.

Phnom Penh is the main hub for professional and skilled roles. Siem Reap is the second most important hiring hub, and Sihanoukville is important for tourism and logistics.

Many Cambodians go abroad to work, perhaps due to the low wages in the country. It’s therefore important to offer good wages and benefits to keep them. However, general admin staff and entry-level employees are easy to find in cities, even if it’s more difficult to find specialists in engineering and IT.

It takes about 4–6 weeks to recruit entry-level roles, but it can take 8–12 weeks or longer for senior and specialized roles. Rivermate can onboard a local in about a week.

Hiring foreign workers can take about three months. There’s also a cap on how many foreign workers you can hire, currently 10% of your Cambodian workforce, unless the Ministry of Labor approves more. Employers apply for an annual quota, and when the foreign employee arrives, they must apply for a work permit within 90 days.

Remote work may be possible for white-collar roles, but not for factory workers. There is no specific remote-work law, so the general Labor Law applies.

Country-specific problem that employers must know

Cambodia uses both the riel and the US dollar, which can be a source of confusion for foreign employers new to the country. USD is not only used in employment settings, but it’s also used in everyday transactions. The dollar became common in the 1990s, when UN personnel arrived after years of instability, and many have preferred it to the riel since.

One area of confusion arises from the fact that contracts can reference USD amounts, but taxes on salary and social security contributions are calculated in riel. The minimum wage is also set in USD.

If you pay salaries in USD, taxes are converted at the official exchange rate on the 15th of each month. This means deductions, and therefore the employee’s net pay, can vary slightly each month.

It’s generally a better practice to pay wages in the local currency. However, you can pay in USD if you want. The important thing is to stick with what you promise in the offer, whether that’s riel or USD.

Compliance risks employers have to know about

Hiring foreign nationals

There’s a cap on foreign employees equal to 10% of your Cambodian workforce, unless you’re granted more from the Ministry of Labour and Vocational Training (MLVT), and you must also apply for an annual quota first.

Employees need a business E-class visa, plus a work permit and employment card from the MLVT. The work permit must be applied for within 90 days of arriving in the country. Employers can be fined if employees do not have a valid work permit. This can be up to KHR 12.6 million per employee.

Probation and contract type

Probation is allowed, and it’s optional. It lasts up to three months for regular employees, two months for specialized workers, and one month for non-specialized workers. It can’t be extended beyond these limits. No notice is required during probation, and either party can end the contract.

Fixed-duration contracts are allowed, and they can run up to two years. They can then be renewed for up to two years, after which they become ongoing contracts. In practice, employment contracts are written in Khmer and can be bilingual.

Termination

It’s important to keep clear records, and the rules depend on the type of contract. In general, you need lawful grounds to terminate an ongoing contract. This could be a valid reason related to the employee’s aptitude, behavior, or the business's needs. You can’t shorten notice below the statutory minimum, which is seven days up to three months depending on length of service.

The rules for fixed-term contracts are different, and you can only end one of these contracts early for serious misconduct, force majeure, or where you have a written mutual agreement that was signed in the presence of a labour inspector. If you end a contract for any other reason, you may have to pay damages to the employee. These must be at least what they would have earned through the end date.

For all contracts, you must also notify the MLVT within 15 days of the termination and pay dues within 48 hours of termination, as well as providing a work certificate on request.

Backdating

You should not backdate contracts in Cambodia due to social security and statutory contributions. Employers must register every employee with the NSSF within three days of them starting work, and declare the hiring to the MLVT within 15 days. If an employee starts work before NSSF registration, their coverage may be delayed. Failing to pay the contributions by the 15th of the following month can lead to interest being charged and fines.

How Rivermate can help you stay compliant when hiring in Cambodia

Our in-depth understanding of local labor laws means we handle your employment relationship compliantly. You can focus on your business while we handle the rest.

Learn more about EOR services

Benefits of hiring employees through an EOR in Cambodia

Hiring employees directly in Cambodia typically requires a local entity. An EOR removes this barrier while providing several benefits.

Hiring in the country is much faster with an EOR. Setting up a company can take six weeks to several months, depending on the sector and licenses, including registering with the Ministry of Commerce, obtaining a tax ID, opening a bank account, registering with the NSSF and the Ministry of Labor, and more. Using an EOR could let you hire local employees within about a week.

The EOR also handles compliance and admin, dealing with contracts in Khmer and English, payroll, tax withholding, and staying up to date with rule changes. Because of the time advantages of using an EOR, it can give you a flexible way to test the market and gradually scale your team before you fully commit to entering the country.

Ready to hire in Cambodia?

If you want to hire in Cambodia, contact Rivermate today. We’ll handle the entire process, from payroll to taxes, so you can hire with confidence.

Talk to a Cambodia Hiring Expert

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