• Increments further delayed with Govt. stepping in 
• RPCs concerned about the future of the plantation sector

By Sarah Hannan  The daily wage increment of the plantation workers is yet again delayed due to the trade unions (TUs) and the owners of the regional plantation companies (RPCs) failing to come to an agreement on the wage model that was proposed by the RPCs in January, just before the Collective Agreement ended on 28 January.   The Labour Minister, as promised in January, had to intervene, with the time period given for both parties ending, and had given directives to the Department of Labour Wages Board to take over the daily wage increment issue for the plantation workers in the tea and rubber industries.   Although a date has not been fixed to announce the daily wage increment through the Wages Board, it is learnt that no sooner the gazette is published, the wage increment will take effect immediately.   “Since the TUs and the owners of the RPCs failed to reach an agreement on the proposed wage increment model presented by the RPCs, the Ministry had to step in to end this stalemate. The RPCs opposed our decision to increase the daily wage to Rs. 900 and have the Government pay the additional Rs. 100 from the budgetary allocations to make up the Rs. 1,000 daily wage that was promised to the workers,” Labour Minister Nimal Siripala de Silva told The Sunday Morning.  After the RPCs had opposed the decision, the Wages Board had called for a vote over the decision, to which they had received 11 votes in favour with seven RPCs voting against the decision, approving the wage model that was proposed by the Minister of Labour.   Estate workers misled  

1000 Movement Co-convenor Chinthaka Rajapakse stated: “The RPCs and the Government seem to have conveniently disregarded the demand of the plantation workers to increase their daily basic wage to Rs. 1,000 from the Rs. 700 they were getting. The Government and the TUs have again misled the public by saying that the daily wage will be increased to Rs. 1,000.”  

[caption id="attachment_119401" align="alignleft" width="300"] 1000 Movement Co-convenor Chinthaka Rajapakse[/caption] According to Rajapakse, the decision that the Minister of Labour announced last week is not entirely addressing the issue either, as the Rs. 900 daily wage that the Minister announced is the compounded total with the Government's budgetary pay increment of Rs. 100 added to it.   Meanwhile, the plantation sector workers once again took to the streets, holding protest marches in Haputale and Thalawakele to demand their wage increments and to point out that the promises made to increase their basic wage to Rs. 1,000 has been ignored by the RPCs as well as the Government.   The revised wage proposal presented by the RPCs in January stood at Rs. 1,108 which was a compound of the basic wage of Rs. 725, a price share supplement of Rs. 50, Employees’ Provident Fund/Employees’ Trust Fund (EPF/ETF) of Rs. 108, and an attendance and productivity incentive of Rs. 225.   However, since the Planters’ Union had disagreed with the payment structure and the parties were not able to sign a new agreement over the wage model that would be followed from 29 January onwards, the plantation workers will be left with a broken promise.  Unfavourable for plantation workers   The Sunday Morning reached out to Planters’ Association of Ceylon Chairman Bathiya Bulumulla, to clarify the present wage that plantation workers are drawing, given that discussions are still ongoing on applying the announced wage structure that is to be passed through the Wages Board.  

[caption id="attachment_105599" align="alignleft" width="300"] Planters’ Association of Ceylon Chairman Bathiya Bulumulla[/caption] “The wage structure still stands at the last agreed upon amount, as the Collective Agreement was not amended. If the Wages Board decides to go ahead with the government-announced wage structure, the plantation workers are still going to face a loss in income, as the compounded wage would still be Rs. 1,000,” Bulumulla explained.  

When asked about heeding the demands of the activist groups i.e. that their basic wage be increased to Rs. 1,000, Bulumulla informed that if the RPCs are to increase the basic wage, they will have to incur an annual cost of Rs. 10 billion.   With the Government now placing all the RPCs under close scrutiny and issuing ultimatums to take over the plantations that are found to be underperforming, we inquired from Bulumulla as to how the RPCs would respond should the State decide to take over these plantations.   “It is not entirely fair by the companies that have only invested in sustaining a plantation such as tea, as the market keeps fluctuating. For companies that have gone for a diversified plantation management structure, they are able to stay afloat even if one crop fails to turn profits in a particular year,” Bulumulla noted.   Should the State decide to take over these companies, it would once again be the plantation worker that would suffer, as the State would struggle to sustain the industries, given its track record on managing other state institutions that involve larger workforces that are burdened with human resource issues.   “This is a sad situation that we are facing, while we were looking to ensure that the workers too feel that they are responsible for the growth of the business and are afforded the chance to make an extra amount when the yields are better, the wage structure that is to be imposed by the Wages Board, if approved, will only give the plantation worker a stable wage that will be applied across the board,” Bulumulla elaborated. 

Govt. to take over plantation companies running at a loss  With the RPCs expressing that they will not be in a position to foot the capital to provide an increment on the basic wage for plantation workers, the Government initiated a performance evaluative study to assess the performance of the RPCs with the participation of the Plantation Ministry, the Sri Lanka Tea Board (SLTB), and an independent audit firm.  While the interim report had been submitted to the Plantation Ministry in January, the final report is expected to be completed by mid-March.   According to SLTB Chairman Jayampathy Molligoda, 20 RPCs were analysed based on their performance over the last 10 years for the study.   “We conducted a critical analysis of the primary expectations of the State from RPCs when the handover of the plantations to the RPCs took place in 1995. At the time of the handover, the RPCs were required to make investments and contribute to socioeconomic wellbeing and environmental sustainability, including the social wellbeing of the labourers. We did a financial and physical evaluation of these expectations with a private audit firm, and handed over our report to the subject ministry last month,” said Molligoda.   However, Minister of Plantation Industries Dr. Ramesh Pathirana said that the aim of the performance evaluative study conducted with the SLTB is not to take over the estates, but to provide a means for the RPCs to optimise the utilisation of the estates.   “The findings of the study will be taken into consideration, to decide whether the RPCs had managed to fulfil the requirements and are at a capacity to continue holding these plantations under their administrations, and their ability to ensure the social wellbeing of the workers by paying the agreed upon daily wage,” Dr. Pathirana noted.