Overview

In Sri Lanka, the Labour Department enforces, maintains and builds awareness of labour laws among the working community. Annually, the Department of Census and Statistics produce a report titled ‘Sri Lanka Labour Force Survey’ which outlines the structure and characteristics of the labour force, employment and unemployment. The report consists of information from provincial and district-level data, covering all the districts of Sri Lanka. As of 2022, 15 percent of the employed population was employed by the public sector, compared to 43 percent in the private sector (the largest proportion).

There are five types of workers in Sri Lanka: permanent workers, probationers, apprentices, temporary workers, and contract workers. Three laws dictate the working hours and holidays: the Wages Board Ordinance of 1941, the Shop and Office Employees Act of 1954, and the Factories Ordinance of 1950. Female participation in the labour force is increasing yearly, but most of the female workforce is engaged in garment factories or handicraft fields. According to the Factories Ordinance, women should not be forced to work at night against their will. If a woman works at night, she shall be paid not less than 1 and a half times her normal salary. The minimum age of recruitment in Sri Lanka is 18 years and the usual retirement age is 55 years. In Sri Lanka, forced labour and child labour are prohibited.

In the private sector, the contracts are time-bound. The probation periods are usually 6 months but can extend up to 9 if necessary. All contract workers work according to a specified job description for a fixed pay that does not involve overtime payments or additional ad hoc allowances. Temporary workers are hired based on a particular task required to be done. On the contrary, in the public sector, employees get a permanent job till the retirement age of 55 years. However, both the private sector and the public sector use cost incentives for more efficiency in work. Incentives are like salary increments, insurance, and job security.

Employees have the right to form and engage in any union activity. Trade unions representing a category of employees can bargain against their needs from the employer. The unions stand their ground with the rights of the employees they are representing.

The National Minimum Wage of Workers Act No.03 of 2016 mandated that all private sector industries or services in Sri Lanka pay their workers a minimum wage, either on a monthly or daily basis and made it a legal requirement. With the passing of the National Minimum Wage of Workers (Amendment) Act No.16 of 2021, which took effect on the 16th of August 2021, the national minimum monthly wage payable to a worker has been readjusted to LKR 12,500 (UDS 39.073), while the national minimum daily wage payable increased to LKR 500.

Labour Rate(s) Overview

statistics.gov.lk/LabourForce/StaticalInformation/AnnualReports/2022