ECONOMYNEXT – Sri Lanka’s commercial tea and rubber plantations are calling for a wage model in the style of small holders moving away from the fixed rates that is reducing output and worker earnings as collapse of the rupee slashes real wages.
The newly appointed head of Sri Lanka’s Planters’ Association which represents the managers of large public traded companies or Regional Plantations Companies, Senaka Alawattegama said “fresh negotiations looming.”
Sri Lanka’s President Gotabaya Rajapaksa ordered 1,000 rupees a day wage to workers who already have a collective agreement as part of promises made in the run up to the elections in a series of state interventions including a fertilizer ban.
Sri Lanka’s small holder farms are already practising a model where a group of workers have responsibility over a farm who are paid according to the volumes they pluck and also keep owners informed of the need for fertilizer and other inputs to boost leaf growth.
Some plantations companies have also tested other wage models. Until the flat rates was re-introduced by manifesto a partial productivity based model was in place.
“The success of the tea smallholder sector – in terms of increasing the earnings of workers and increasing productivity proves that this model is effective,” Alawattegama said in the prepared text of a speech made at the annual meeting of the Planters’ Association.
“The experiences of RPCs (Regional Plantations Companies) that have now reliably shown that worker earnings increase drastically when wages are linked to productivity.
Sri Lanka’s RPC have been losing its workforce steadily to other sectors and there are shortages especially in farms closer to the Western Province which is partly blamed on the lack of the current wage model and the lack of mobility of labour.
“Looking to the future, our biggest challenges may well be ahead of us,” Alawattegama ssaid.
“Chief among them is the shortage of labour across the plantation sector.”
The workforce of the RPC’s which were at 327,000 in 1992 when privatization of the sector began to 115,000 so far.
There were no signs of it stopping he said.
“Especially if Sri Lanka is to achieve its national production targets our first priority is to implement every viable measure to reverse the migration of labour out of the plantation sector,” Alawattegama said.
“The only way to accomplish this is to introduce a model of work that actually serves the interests of our employees.
“The same flat daily wage system which has been in place since the colonial era is simply not suited to the task.
“As our Association has stated time and again, a productivity-linked wage is the only way forward.
“With it, we can pay workers substantially more than the flat daily Rs. 1,000 they currently earn, and even more than the new flat daily wage rates that are now starting to be demanded.”
Politically connected plantations workers had in the last instance intimidated estate managers, he said.
“In several instances, our fellow planters were forced to put their life and limb at risk as a result of mob violence incited by politically connected individuals,” he said.
“Sadly, in recent years, good-faith negotiation has increasingly given way to similar kinds of thuggery.” (Colombo/Sept26/2022)