3 more months of reduced wages
The Labour Ministry on Friday reached agreement to extend the consensus between employers and workers to ensure that private sector staff continues to be paid half the basic or Rs.14, 500 for the next three months.
This extension of the agreement, initially reached in May, between the Employers’ Federation of Ceylon, the trade unions and the Labour Ministry came after much discussion since trade unions insisted that employers continue to layoff despite the agreement to retain this staff under the circumstances on the newly agreed payment structure.
FTZ Union leader Anton Marcus told the Business Times that they continued to support this payment structure since they want to ensure that workers’ jobs will be retained and they will continue to receive some source of income during this crisis.
In this respect, the agreement will be effective until August and in between there will be a monthly review as well.
The agreement places a distinction between the payment of wages in respect of employees who performed work and those who had to be ‘benched’ (without any work) since companies are unable to bring the full workforce due to COVID-19 restrictions.
Following concerns by the unions of continued layoffs it was agreed that there should be an oversight committee to look into the implementation of the agreement and find solutions to disputes that arise during the COVID-19 crisis.
This came even as MAS Holdings informed its staff this week that its executive cadre will have to be reduced as it will take nearly two years for the company to recover from the current crisis.
Responding to queries from the Sunday Times, the company noted that the announcement of the Separation Scheme for the Executive cadre will be implemented over the next three months.
“We have little option but to re-structuring and re-aligning our resources to service the significantly lower volumes of business.”
There is no visibility of any orders for next year yet from key markets like the US and the UK, the statement said.
Currently they are experiencing an overall volume drop of around 30-35 per cent than originally planned for this year.
Last month another Hong Kong-based large apparel firm with factories in Sri Lanka had also introduced a Voluntary Retirement Scheme that sent about 1000 workers home.
More apparel firms are likely to follow suit but are still awaiting markets like the US to react before going ahead.