Finance Industry Analysis

Tea Industry Planters Caution Against Across-the-Board Wage Increases, Citing Risk of Sector Bankruptcy

Plantation companies are holding firm on their stance regarding productivity-based wages for estate workers, amidst union demands for a daily pay of Rs. 1,700. The Planters’ Association (PA) of Ceylon emphasized that while they are not opposed to wage hikes in principle, they insist on tying such increases to productivity gains. The Association submitted a proposal to the Labor Ministry advocating for wage hikes under productivity-based and attendance-based models, awaiting a response.

The PA warned against unilateral actions on wage hikes, citing potential disastrous consequences akin to the recent fertiliser crisis. Dr. Roshan Rajadurai, the Association’s Media Spokesperson, highlighted the need for collective and methodical solutions. He noted that their proposal could allow workers to earn close to Rs. 2,000, emphasizing the sector’s already high wages compared to other industries under the 45 Wages Boards, coupled with non-wage benefits.

In response, estate sector trade unions expressed skepticism about ongoing discussions with authorities and the employers’ response, especially given rising inflation since the last wage hike. They indicated plans to escalate trade union actions to push for their wage demands, highlighting the urgency and importance of reaching a mutually agreeable solution.

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