The Council of Ministers on Friday approved a draft law on social security and benefits for workers in the private sector, a move government and union officials say could improve the economy by boosting worker confidence.
The law will be important to safeguard the living conditions of workers when they are old or “sick or injured at work,” said council spokesman Penn Thol.
He said the law would likely prompt more civil servants to seek jobs with higher-paying private businesses, reducing the government’s bloated payrolls.
The government already has a pension plan for civil servants that pays benefits up to 70 percent of their average salary after 20 years of employment.
But private sector workers have no such assurances. Benefits, severance packages and sick leave are all dependent on union pressure or independent management policies.
While the six-chapter, 41-article draft law does not yet include specific details of the benefits program, it was enough to bring praise from government and labor officials.
Phoung Montry, chief of information and membership of the Free Trade Union of the Workers of the Kingdom of Cambodia, called the passage of the draft law “the best news.”
“The law is important to safeguard the poor,” he said. “Workers’ wages are just enough to live hand to mouth, so when they get older, fired or sick…they have no money.”
Pheng Heng, deputy chief of cabinet for Phnom Penh’s social affairs department, said the law will “strengthen the [overall] state of law.”
He also said the new law will lure people to the private sector with assurances of a secure future. Now people “cling to government posts, even with a very small salary, because the government assures their posts and defends their rights,” he said.
Garment workers, on the other hand, have had to stage “many demonstrations for the loss of their jobs and their rights,” he said.
The Free Trade Union has been lobbying for such a law since 1998, said Chea Vichea, the union’s president. The law will allow the private sector to expand, he said.
But there are some obstacles to progress, he said. Chief among them is a still-unskilled labor force, unfit for privatized competition.
“Government employees are old people from the communist regime, which had poor human resources that cannot work for the private sector,” he said.
Eventually, Chea Vichea said, he would like to see the government establish a social security system similar to developed countries, where retirement money from all citizens—whether civil servants or private employees— is handled by the government. He said that would be a more secure method.
