July 09, 2012 (LBO) – Sri Lanka, one of the world™s largest tea exporters, has been urged to replace its ageing politicised wage structure with a productivity linked model, to sustain the viability of the centuries old brew. Trade unions, backed by ethnic minority political groups, prefer a fixed day™s wage instead of a productivity-linked pay for some 400,000 estate workers. Unions have often struck work, until the government gives in for some of their demands.
Plantation companies have often opposed an adhoc increment as it raises the cost of production, making tea exports more expensive in a competitive global market place.
Last April a 27 percent wage increase came into effect, raising the minimum daily wage to 572.00 rupees (4.36 dollars) from 447.50 (3.41 dollars).
The increment came as the Sri Lankan rupee weakened against the US dollar, pushing tea output costs up by 100 rupees a kilo, lamented Rienzie T Wijetilleke, Chairman Sunshine Holdings PLC.
The successive wage increases mandated for the tea sector have been regressive,¦ because mandated increases contain no element for linking wage increases to productivity, said Wijetilleke, a former tough-talking banker .
We hope that