How to hire remote employees in

Cambodia

Cambodia is a hub of some great remote talent. But if you’re not already physically established there, hiring in Cambodia can feel like pulling your hair out. We’re here to make it feel easy—in the next couple of minutes, you’ll learn how to hire remote talent in Cambodia, without all the headaches.

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Employment requirements

Country snapshot

CURRENCY

Cambodian Riel (KHR)

EMPLOYER TAXES

3.40%

PAYROLL FREQUENCY

Monthly

OFFICIAL LANGUAGE

Khmer

Why hire independent contractors in Cambodia

Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in Cambodia.

It’s the fastest way to hire globally

Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.

It’s a lot cheaper

It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.

It’s more flexible for you & your team

HHiring contractors in Cambodia means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.

Can be less risky than hiring employees

Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.

Some people want to be employees

The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.

You might not have as much control over your talent

Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.

What to know before you hire in Cambodia

Hiring remotely in another country is normally difficult—the labor laws are different and you haven’t established a physical presence, so you’ll need to rethink the way you approach hiring. Bottom line is, you’ve got two options—we’ll cover them below.

If you want to successfully hire in Cambodia, you have two options:

Hire talent as contractors

Laws about hiring contractors are significantly more simple in Cambodia. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Thera for.

Hire talent as employees

This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in Cambodia is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.

Hire contractors in a couple clicks with Thera

How can I pay people in Cambodia

If you’re hiring contractors in Cambodia, you can pay them with Thera in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.

If you want to hire employees in Cambodia

If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Cambodia than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Cambodia.

Taxes in Cambodia

Employer tax

Health Insurance

National Social Security Fund

Leave

Paid Time Off (PTO)

PTO is calculated by the:

Employees are entitled to 18 days of paid leave per year and are accrued at a rate of 1.5 days per month.
For every 3 years of employment, an additional day of paid leave is given.

Public Holidays

There are 15 public holidays.

Sick Days

Employees are entitled to up to 6 months of sick leave per year as long as they are able to provide a medical certificate.

The employee will receive 100.00% of their regular salary rate for the first month of sickness, the two months that follow are paid at 60.00%, and the remainder of the leave is unpaid.

An employer holds the right to dismiss an employee following more than six months of sick leave.

Maternity Leave

Maternity leave is 90 days and the woman is entitled to 50% of their pay.

Paternity Leave

There are no provisions in the law regarding paternity leave.

Parental Leave

Parental leave falls under special leave.

Other Leave

Special leave– Employees are entitled to up to 7 days per event for matters that affect an immediate family member.

Marriage Leave

An employee is entitled to 7 days of unpaid leave in the event of their wedding.

Bereavement Leave

In the event of the death of an immediate member, an employee is entitled to bereavement leave.

For the death of a father, mother, spouse, or child, an employee is entitled to seven days of unpaid leave.

Termination

Termination Process

Fixed-term contracts- If the employer and employee agree, a fixed-term contract can be terminated before the end date. To do so, both the employee and employee must sign an agreement in front of a labor inspector. If one of the parties does not agree, the employment contract cannot be terminated unless for reasons of gross misconduct or force majeure.

Indefinite employment contracts- Written notice must be given. If the employer initiates the dismissal, then just cause must be provided. The employer must notify the Ministry of Labor

Upon termination, the employee is entitled to request a certificate of employment stating the dates of employment and information about the position held. If the employer refuses to provide this, the employer must pay the employee for damages.

Notice Period

The notice period in Cambodia is based on the duration of employment as well as the type of employment contract:

For indefinite employment contracts:

Up to 6 months of employment- 7 days’ notice
6 months to 2 years of employment- 15 days’ notice
2-5 years of employment- 1 months’ notice
5-10 years of employment- 2 months’ notice
10 year of employment- 3 months’ notice

Fixed-Term Contracts:

Up to 6 months of employment- no notice is required
6 months to 1 year of employment- 10 days’ notice
1+ years of employment- 15 days’ notice

During the notice period, the employee is entitled to 2 days’ paid leave per week for the purpose of looking for employment.

Severance Pay

The Severance Pay in Cambodia:

If the employer fails to give written notice or does not follow the notice period, compensation must be given to the employee for the amount that the employee would have earned during the notice period.

6 months- 1 year of employment- 7 day’s wages
More than 1 year of employment- 15 days’ wages for every year of employment, capped at a total of 6 months’ worth of wages. Maximum 6 months.

Probation Period

The probation period varies depending on the skill level of the employee:

3 months for regular employees
2 months for skilled employees
1 month for unskilled employees

Employee requirements in Cambodia

Working Hours

A standard full-time workweek is 48 hours.

Overtime

Overtime is paid at the rate of 150% of the regular pay.

For overtime between 10 PM and 5 AM, the pay rate is 200%.

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