Sri Lanka plantations look to extend productivity link

Oct 15, 2010 (LBO) – Sri Lanka’s plantations industry is looking to extend a productivity linked pay scheme when talks on renewing a wage deal with labour unions begin early next year, an official said. Lalith Obeysekere, chairman of the Planters’ Association, which represents regional plantations corporations, said the industry is satisfied with gains from a two-year collective agreement with unions that linked pay to productivity for the first time.

“From our point of view it is working well,” Obeysekere told LBO in an interview. “It is the first time we made a breakthrough and linked wages to productivity.”

The island’s tea industry, which is over 100 years old, has the highest cost of production among major tea export origins, which erodes its competitiveness in the global tea market.

The three main unions signed a two-year collective agreement with the plantations companies in September 2009 but effective from April that year which raised a worker’s daily wage by almost 40 percent to 405 rupees.

The deal for a 285-rupee basic wage, a 30-rupee productivity linked allowance and a 90-rupee attendance allowance replaced a previous one where the total wage was 290 rupees, including al

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