Employment contracts in Cambodia: fixed-term vs undetermined
The difference between FDC and UDC in Cambodia, what happens when a fixed-term contract rolls over, and how to track expiry before it decides for you.
FDC and UDC are not just paperwork labels
Cambodian labour law distinguishes a fixed-duration contract (FDC), which has a defined end date, from an undetermined-duration contract (UDC), which does not. The distinction drives what you owe at the end: an FDC that runs its course attracts a severance payment, while a UDC that ends attracts seniority indemnity. Two different obligations, decided by which contract the employee was actually on.
The two-year rule that catches employers out
A fixed-duration contract in Cambodia cannot run indefinitely through renewals. Once the total duration across renewals passes the statutory limit — two years — the relationship is treated as undetermined, whatever the paper says. Employers who renew a twelve-month contract for the third time without noticing have changed the employee's status and their own obligations without intending to. Track the cumulative duration, not just the current contract, and take advice before the second renewal rather than after it.
Practical points to settle in writing
- The contract type and, for fixed-term, its exact end date
- Probation length, within the limit for that category of work
- Notice periods on both sides
- What counts as the wage base for severance and indemnity
- Whether renewal is intended, and on what basis
What the system tracks, and what it cannot decide
Software can hold the dates, the type, and the chain of renewals, and tell you before an end date arrives. Whether a particular renewal has crossed a statutory line is a legal judgement — the value here is that you see it coming with time to take advice.
- 1HR / PayrollDraft
Create the contract with a type and dates
Permanent, fixed-term, probation, internship, part-time, or contract — the type is a field, not a sentence buried in an attachment, so it can be reported on and reasoned about later.
- 2HR / PayrollActive
Activate it, and it becomes the employee's terms
One active contract at a time. Everything that depends on terms — notice, entitlement, what payroll pays — reads the active contract rather than an understanding somebody has.
- 3Humaneti
Expiry is visible before it happens
Contracts approaching their end date surface as a list. A fixed-term contract that expires unnoticed is the single most common way an employer ends up in a position it did not choose.
- 4HR / PayrollRenewed
Renewal creates a new contract and closes the old one
The previous contract is marked renewed rather than edited, so the chain of terms the employee has actually worked under stays intact. That chain is what you need when the cumulative-duration question comes up.
- 5Manager
Probation ends with a recorded decision
A probation review is a dated appraisal, not a conversation somebody remembers. Confirming or ending employment at that point is a decision you may need to evidence, and the review is the evidence.
- 6HR / PayrollExpired / Terminated
Ending it points at the right obligation
Because the contract carries its type and its full duration, final pay is calculated against the right basis — severance or seniority indemnity — rather than whichever one the person doing the calculation reached for.
This guide describes how contract data is structured and tracked; it is not legal advice. Cambodian labour law sets limits on probation length and on how long fixed-duration contracts may run through renewals — confirm the current position with a qualified adviser before renewing.
Sources
Every rate on this page comes from the instrument below. Check them against your own filing before you rely on a figure.
- Prakas on seniority paymentMinistry of Labour and Vocational Training (MLVT) · Labour Law, contracts, leave and seniority indemnity
Prakas number not yet cited — confirm the current instrument with the issuing body.
- Labour Law provisions on paid annual leaveMinistry of Labour and Vocational Training (MLVT) · Labour Law, contracts, leave and seniority indemnity
Prakas number not yet cited — confirm the current instrument with the issuing body.
Rates on this page have not been verified against the current instruments.Reviewed every quarter and whenever a new Prakas is issued.