Sinotex (Lanka) Ltd, among the oldest factories at the Katunayake IPZ, is to disburse around Rs. 320 million for the payment of compensation to 2,250 workers after the company said it was shutting down.
The company is now paying compensation but the workers expressed concern on the failure of the employers to stick to the agreed compensation formula, trade union officials said. The management of the company decided to close the factory from January 14 due to a reduction of export orders from the US market last year.
Trade union official Anton Marcus told the Sunday Times FT that the management has earlier agreed to pay the compensation based on the salary for the month of January 2009 which includes a Rs 1,000 salary hike. He added that the company has so far failed to discuss with the Labour Department the payment of statutory dues for employees including the compensation formula.
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