Sathosa staff to be sent on compulsory retirement

• Management announces termination of 292 employees under mandatory retirement scheme 
• All payment of salaries to cease on 30 September and assets to be liquidated 
• Employees threaten to take professional and legal action against decision in the coming week 

Lanka Sathosa Ltd. Board of Directors has decided to implement a compulsory retirement plan as part of its restructuring efforts affecting at least 300 employees starting from 30 September.

Accordingly, 292 persons, occupying various roles such as General Manager, Manager, Store Manager, Accountant, Assistant Accountant, Management Assistant, Supervisor, Regional Supervisor, Supervisor (Engineering) and driver are slated for job termination.

The Sathosa administration made this decision following the approval of a Cabinet paper presented by the Minister of Trade, Commerce, and Food Safety Nalin Fernando to the Cabinet.

Under this compulsory retirement scheme, as per a circular issued by its Chairman Pasanda Yapa Abeywardane, all employees will cease to receive monthly salaries and other allowances starting from 30 September.

Additionally, it has been noted that a committee appointed in accordance with the Cabinet's approval, has devised a compensation formula for all Sathosa employees. The circular has further conveyed that, after deducting any outstanding loans, debts owed by Sathosa employees, and any required payments pertaining to disciplinary actions, the remaining funds will be distributed in accordance with the compensation formula.

Furthermore, the circular has outlined that apart from the compensation provided under this Compulsory Retirement Scheme, employees will retain their entitlement to statutory benefits such as the Employees' Provident Fund and Employees' Trust Fund allowances.

The circular has also communicated that the service gratuity owed to employees will be computed up to 30 September 2023 which aligns with the compulsory retirement date, and this amount will be disbursed before 15 October. Concurrently, the administration has also decided to liquidate all properties owned by Sathosa. As part of the Cabinet's decision to restructure Sathosa, both immovable assets like land and buildings, as well as movable assets such as lorries, are slated for liquidation.

However, the staff has expressed their opposition to the compulsory retirement plan and to the liquidation of Sathosa properties.

In response to these decisions, the employees took their concerns to the Ministry of Trade, Commerce, and Food Safety last Friday, where they requested a reconsideration of these measures. During the discussion held at the ministry, the secretary of the ministry conveyed that, given that the retirement of employees and the liquidation of Sathosa are carried out in accordance with the Cabinet's decision, he is unable to intervene or take any action to change these decisions.

In response to the ministry's stance, the employees have decided to initiate professional and legal action starting next week to protest against the ministry's decision.