Sri Lanka plantation worker wage hike talks in deadlock


Sep 01, 2015 (LBO) – Sri Lanka’s Planters Association says higher wage demand issue of the tea planation workers is still dragging.

“Status remains as it is, since no one came for a final solution,” Roshan Rajadurai, president of Planter’s Association of Ceylon, told Lanka Business Online.

“We could not afford the almost 50 percent wage hike that workers demand as the industry is losing profits due to lower demand from Russian and Middle East markets and fall in tea prices,” he said.

The Planters Association has offered a productivity-based wage model, rather than just increase the wage, which would result in further losses to the companies, so that high performing pluckers could earn more.

The association has proposed an 11 percent increase in the basic wage to 500 rupees (from 450 rupees at present) for a minimum daily plucking average of 15 kg of tea leaves. Each additional kilogram plucked will be paid at 40 rupees (an increase from the 23 rupees paid at present), thus enabling a worker who plucks 25kg of tea leaves to earn 1,000 rupees a day which includes EPF and ETF.

However, there wasn’t a good response from the union for the newly introduced system, and they said they need time to study the proposal.

“Union refused our proposal. They just wanted us to give them the hike without considering any other factors. We can’t do that, which will have a tremendous impact on the industry,” Rajadurai said.

He said wages represents about 75 percent of the total cost of a plantation company. “We have taken loans and banks are refusing to lend to us anymore. So we really do not have the capacity to pay,” Rajadurai added.

Re-negotiation is also deadlocked as the government has not appointed a minister to overlook the issue and lead the talks.

“Nothing has happened and everything is at a stand still since we do not know who will be the ministers,” Marlin Goonetileke, secretary general of Planter’s Association of Ceylon said.

Sri Lanka held its general election on 17th August and could not name a cabinet of ministers as the main parties, United National Party and Sri Lanka Freedom Party is in a disagreement on sharing ministries which analysts says is leading to political uncertainty.

The talks began in March this year with the end of a collective agreement of trade union and planters.

Plantation union officials were not available for comment.