Plantation companies say Dec.31 deadline to finalise wage agreement unrealistic

The government has told Regional Plantation Companies (RPCs) to finalise the collective agreement on plantation worker wages before 31 December 2023, to which they responded stating the timeline is unrealistic.The call to finalise the collective wage agreement was raised during a meeting at the Presidential Secretariat on Friday, attended by President Ranil Wickremesinghe and leaders from the plantation sector.
As per a statement released by the President’s Media Division (PMD), Wickremesinghe advised RPCs to engage in a collective agreement concerning the wage hike for plantation workers, aiming for a minimum of Rs.1700, as per their request.
They were urged to reach a consensus on the increased wage amount before the end of the year.

However, speaking to Mirror Business, an industry representative said the end-of-year deadline was stressed by the Minister of Labour Manusha Nanayakkara, to which the President agreed. The plantation companies did not agree to the timeline. During the meeting, the Labour Minister stressed the need to finalise an agreement with a daily wage of Rs. 1,700 at the earliest because agreeing to the proposed revenue share/productivity-based wage model by certain labour unions is taking time.

“We will sign the agreement even tomorrow if the labour unions agree to the proposed model. But they are not. We communicated clearly at the meeting that we cannot agree to the Rs. 1,700. It is not realistic for us given the high cost of operations,” Planters’ Association (PA) Spokesman Roshan Rajadurai told Mirror Business.

He said at the meeting the plantation companies made it clear they will not sign an agreement that they are unable to commit to Rajadurai asserted that under the productivity wage model, plantation workers earn nearly Rs.65,000 monthly. The model is gaining acceptance among the workers. However, certain trade unions continue to oppose it.

He went on to note that the proposed model also helps to increase the productivity of workers, given that the more they pluck, the more they earn.

PA has repeatedly pointed out that the productivity of local plantation workers is possibly the lowest in the region, yet they fetch a higher wage in addition to other facilities.

On average, plantation workers in Sri Lanka pluck about 18 Kgs of tea leaves per day, whereas in India, the workers pluck about 32 Kgs a day.

“They (Labour Ministry) can ask us to finalise the agreement, but they can’t force us to enter into any agreement just to satisfy the trade unions. Many companies are already closing down as they can’t sustain the high operational costs. So they need to understand the situation by looking at the ground realities,” stressed Rajadurai.