Fair Play

The Arbitration Council plays a vital role in in resolving Cambodia’s collective labour disputes. Management Insider spoke with lawyer and arbitrator Chhiv Phyrum about the council’s place in today’s dynamic market.

“ Since the Council was appointed to resolve disputes, more and more people have become educated on what their rights are under the Labour Law. ”

– Chhiv Phyrum, Lawyer and Arbitrator, The Arbitration Council

When it comes to workplace conditions and worker rights, employers and employees, understandably, do not always see eye to eye. If the two parties can not resolve disputes and come to agreement via internal negotiations, industrial disputes, strikes and protests can materialise. The independent Arbitration Council was established to avert such action, which can negatively affect the bottom lines of companies and their employees.

After Cambodia’s economy exploded into action in the late ‘90s, the Council was established with the support of the Labour Ministry, unions and employers in 2003 to serve as an independent, national-level mediator with quasi-judicial authority under the Labour Law to resolve collective disputes.

“The Arbitration Council provides a free, transparent, unbiased and neutral system for cases to be heard,” lawyer and arbitrator Chhiv explains. “This system has become very well accepted in Cambodian society as a means to resolve disputes.”

Understanding the Process

When collective labour strife arises, disagreements that cannot be solved in-house are forwarded to the Labour Ministry’s conciliators. If agreement is not reached there, the case is passed to the Arbitration Council. (Note: The Council does not deal with individual disputes.) “This process is mandatory by law and the parties do not get to decide whether or not we arbitrate the case unless there is another rule of arbitration written in their collective bargaining agreement,” Chhiv points out.

Specialised in conflict resolution, the Council will seek to find an amicable solution through private negotiations. Failing that, the Council will hold hearings for both sides of the dispute and then issue a decision, generally within 15 days. Before the decision is handed down, both parties must agree on whether they will respect the Arbitration Council’s ruling as final and binding. “As the Council has gained confidence and trust to deliver the best decision, we are finding that parties are choosing the award to be binding rather than non-binding,” Chhiv explains.

The Role of Arbitrators

While the parties involved do not get to choose if their case is arbitrated or not, they do get to choose who represents them during proceedings. There are currently 30 arbitrators available on the Council: 10 on the employer list, 10 on the employee list, and 10 on the Ministry of Labour list. Serving in the honourary arbitrator role for employers since 2005, Chhiv has handled more than 200 cases. As well as being a qualified lawyer, she has a high-profile background in human resources, having worked with Cambodia Airport Management Services and with Manulife.

When asked about her personal contribution to developing labour relations in Cambodia, Chhiv reveals the secondary service that the Council serves – putting confidence in the industry. “Since the Council was appointed to resolve disputes, more and more people have become educated on what their rights are under the Labour Law. People are also now aware that there is an independent process and that conflicts can be resolved transparently and fairly.” Chhiv says. “As a result we have seen an increase in cases received by Council. Strike action has also decreased a lot as employers and employees choose to work things out. People listen to us and respect our decision.”


Graph-2-fair-playThe Most Common Disputes

Many of the labour disputes Chhiv oversees and mediates involve employers in the garment and footwear industry, which has been under great pressure in recent years to improve conditions for employers, including with a series of rises in the minimum salary dictated by the central government.

“90% plus of cases heard by Council are related to the garment industry. However, more industries are aware of our existence and I have also arbitrated cases in the tourism, construction, hospitality, telecommunications and transport sectors,” Chhiv says. “The biggest disputes we receive involve wages and bonuses followed by disciplinary and terminations. Working conditions, safety issues and the rights of women are also a concern.”

How to Avoid Disputes

While the Arbitration Council exists to resolve conflict, the ideal situation would be to avoid unnecessary disputes in the first place. The disputes are inevitable, however, with many employers constantly pushing the boundaries in a bid to increase output and reduce costs. “If a company does not want rights disputes, stick to what the law says and respect the law,” Chhiv advises. “This will help to avoid rights disputes because these occur when employers do not respect legal requirements.

“However, if the dispute is “interest” related, a resolution is more complicated. For example, pregnant women being granted priority to leave work first is not written specifically into the law, and would solicit different reactions from employers and employees, making the resolution to such a dispute far from black and white. Chhiv advocates good communication and social dialogue, for example regular meetings and sharing of information, in order to keep these types of issues on the table for discussion and not simmering away beneath the surface waiting to explode.

“It is important to keep talking to each other where concerns can be raised. Employers can also inform staff of changes, in terms of when and how, and if employees have this information they may be more patient. Often employers will also underestimate a change in policy and do not communicate it properly with their staff which can cause conflict.” Chhiv explains.

“If possible it is best to negotiate a collective bargaining agreement where all expectations of staff and/or their representatives are discussed and signed with a mechanism for conflict resolution,” she concludes. “This mechanism may help to reduce illegal strikes which are very costly to the employer.”

Words by Jo Hocking