Tea workers issue fresh warning over new wage formula

Friday, 10 July 2015 00:25 - - {{hitsCtrl.values.hits}}

By Waruni Paranagamage

The All Island Estate Workers Association (AIEWA) yesterday threatened to continue island-wide work slow-downs if the Planters Association (PA) fails to revise its wage formula within 14 days.

In response to the ‘go-slow’ campaign that was commenced from 6 July, the PA has ordered the closure of factories belonging to 23 tea companies until such time that disagreements with regard to wages are straightened out.

AIEWA President Ramalingam Chandrasekaran confirmed that discussions between the planters association and estate worker unions had failed to produce any kind of compromise since negotiations commenced in March 2015.

The unions have demanded a Rs. 400 increase while the PA maintains the position that any further wage increases must be linked to productivity in order to ensure that producers could absorb the cost, particularly given the ongoing slump in tea prices, parallel to generally deflated commodity prices in international markets.

Wages and benefits to estate workers accounted for 67% of the tea plantation sector’s total cost of production in 2014, with estate workers currently being paid a daily wage of Rs. 620, as compared with Rs. 515 in 2011 and 2012 and Rs. 60 in 1992 shortly before loss-making RPCs of that time were privatised.

Sri Lanka’s wage costs are also the highest among international tea producers with major competitor Kenya paying a daily wage equivalent to Rs. 443.3 while South India pays its workers Rs. 426 and Assam Rs. 202.35. Conversely, productivity per worker in Sri Lanka is among the lowest in the world at 18 kilograms per worker per day, against 48 kg in Kenya, 38kg in India and 26kg in Assam. As a result of ‘go-slow’ protest, the workers are now plucking only 4-5 kg a day.

Consequently the PA had urged trade unions to consider a 26 minute increase in effective working time – discounting time spent on lunch and tea breaks, travel, and meals – in order to generate an additional 2 kg of output per worker.

However with the declaration of strike action by trade unions, the PA has asserted that factories will stay closed.