Cambodia: The Social Security Pension Scheme

The Royal Government of Cambodia issued Sub-Decree No.31 on the Social Security Pension Scheme on March 4, 202. It details the registration requirement, contribution rate, and benefits for both Compulsory Pension Scheme and Voluntary Pension Scheme, which applies to all persons under Cambodian Labour Law.

Under the Compulsory Pension Scheme, all owner(s) or employer(s) of an establishment(s) /enterprise(s), who employ at least 1 employee must register their establishment(s)/enterprise(s) for the National Social Security Fund on Pension Scheme within 30 days after the effective date of the Sub-Decree, unless they are already registered under the existing Health and Occupational Accident Scheme.

For the Voluntary Pension Scheme, only a member of the National Social Security Fund (NSSF) who meets 1 of the following requirements is allowed to participate:

• Losing a paid job before reaching 60 but still having the ability to pay the contribution payment.
• Being less than 60 and wishing to contribute to get higher old-age benefit than the benefit they would receive under a compulsory scheme.
• Having an income higher than the wage ceiling determined by a separate sub-decree.

Under both compulsory and voluntary schemes, the benefits include old-age benefit, disability benefit, survival benefit, and funeral allowance. Except for funeral allowance, the other pension benefits for the two schemes will be provided bi-monthly and adjusted annually based on the change in consumer price index determined by the Ministry of Planning.

The contribution rate is determined at the following rates and phases:

• Phase 1: 4% of the contributable wage during the first 5 years from the contribution starting date to be set by the Ministry of Labor and Vocational Training (MLVT)
• Phase 2: 8% of the contributable wage during another 5 years after Phase 1
• Phase 3: Addition of 2.75% of the contributable wage to the above rate during the next 10 years, and subsequent increase of 2.75% every ten years.

During the first 5 years, the employee and employer under the compulsory scheme each will share 50% of the contribution payment to NSSF.

For the voluntary scheme, the applicant shall bear 100% of the cost.