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Estate sector wage hike: Decision after tomorrow's meeting 

28 Feb 2021

  • RPCs bemoan affordability 

  • Rs. 17 b out of Rs. 62 b revenue needed

  The Government has failed to finalise the Rs. 1,000 minimum wage for estate sector workers as yet, as the Regional Plantation Companies (RPCs) have raised concerns over the affordability of a wage increase, The Sunday Morning learnt.    If the RPCs go for a wage hike, they have to allocate Rs. 17 billion out of their total revenue of Rs. 62 billion a year. However, the RPCs are planning to take a decision at the Wages Board meeting to be held on 1 March.    “The issue is affordability,” Plantation Association of Ceylon (PAC) President Bathiya Bulumulla told The Sunday Morning, adding that there was no agreement as of yet between the plantation companies, the Labour Department, and the trade unions.    “Plantation companies can’t afford it. It’s Rs. 17 billion. The total revenue is Rs. 62 billion. We have not agreed as of yet and after 1 March, we will take a decision,” he claimed.    Nevertheless, the plantation companies had on 29 January, under several conditions, agreed to increase the minimum daily wage of estate workers to Rs. 1,000 from February.    The conditions included adopting a hybrid model, amending the Payment of Gratuity Act, and harvesting a minimum of 16 kilogrammes of tea per week.    However, at a recent Wages Board meeting, the RPCs opposed the move to grant a fixed minimum wage for workers, as it would be a serious threat to the sustainability of the tea industry. Instead, the RPCs proposed a three-day minimum wage system, a revenue share model, and a pay based on every kilogramme of tea plucked by the workers, which was not welcomed by the unions.    However, as discussions with the unions failed to reach a compromise last week, the Wages Board decided to approve a daily minimum wage of Rs. 1,000 for plantation labourers which will comprise of Rs. 900 from the plantation companies and Rs. 100 from the budgetary allocations from the Government.    Workers are to receive their Employees Provident Fund and Employees Trust Fund remittances separately.    At a previous meeting held with the PAC, the Minister of Labour was firm about the Government’s decision that the minimum wage for plantation workers should be Rs. 1,000 and that it could not be changed under any circumstances, and had warned the companies that if any company is unable to pay the minimum wage of Rs. 1,000, to then hand over the estate company to the Government.    Meanwhile, cabinet approval has also been granted to increase the daily wages of estate sector employees up to Rs. 1,000, across wages control boards so that the budget proposal on this could be implemented.    The estate sector employees are eligible for a daily wage/remuneration of Rs. 750, including a fixed price allowance of Rs. 50 and another allowance named as an over a kilogramme rate, if the fixed weight of a kilogramme exceeds productivity.


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