Storm on tea estate turns into typhoon

Plantation companies and trade unions stick to their guns as crisis threatens the industry
By Chathuri Dissanayake

Talks between Regional Plantations Companies (RPCs) and trade unions over a wage demand of Rs. 500 a day for workers collapsed on Friday bringing the accumulated loss in the tea industry so far to Rs. 1.5 billion.

Trade unions led by Minister Arumugam Thondaman, leader of the Ceylon Workers Congress (CWC), said they were not ready to budge from their demand of a Rs. 500 daily wage.

The RPCs agreed to raise wage up to Rs. 385 at the last round of talks but the trade unions rejected the offer. At present, the average daily wage of an estate worker is Rs. 290.

The crisis is brewing at a time when the world market demand for tea is going up because of a drop in supplies from Kenya and India. (See Economic Analysis on Page 16). If the dispute is not resolved urgently, Sri Lanka will not be able to make the maximum of the favourable world market conditions, industry sources said.

Minister Thondaman told the Sunday Times that they were not ready to come down from their demand. “Rs. 500 is a reasonable demand though it is barely enough to meet the rising cost of living. Inflation has risen by 55 percent during the last two years. Our demand is not too high as the RPCs put it. The companies must realise that estate employees work in extreme weather conditions and trade union action is the only trump card they have to get their demands,” he said.

CWC National Organiser R. Yogarajan said that at Friday’s talks, the RPCs agreed to pay Rs. 385 as the minimum wage, but the trade unions were not ready to take it.

“We stick to our demand of Rs. 500 a day. Since we have not got our demand, we will intensify our trade union action in the coming days,” he warned.

However, the Planters Association insists that it cannot meet the Rs. 500 demand because if they do, it would increase the cost of production by Rs. 10 billion a year and they would be finding it difficult to compete in the international market.

“Our cost of production is the highest in the world, partly because our work force is less productive. We cannot meet their demand,” Planters’ Association Chairman Daminda Perera said.

He said the Rs. 385 offer they made was a 33 percent hike which would work out to a monthly salary of Rs. 9,750 – an increase of Rs. 2,375.

“But they are demanding a 75 percent wage hike which we are unable to give,” Mr. Perera said.
But Deputy Minister P. Radhakrishnan, who represents the Upcountry Peoples Front (UPF) and the Upcountry Workers Front (UWF), disputed these figures.

He said if an estate worker were to earn Rs. 9,750 a month, the companies will have to give them work for more than 25 days a month. But not all workers work 25 days a month. Most of them do not get even a week’s work, he said.

“People must be fit to work. Estate workers work in the sun and the rain and they toil hard for the small wage they get. Because of the severe weather conditions, a majority of the workers can’t work 25 days. So they lose the attendance incentive,” Mr. Radhakrishnan said.

But Planters Association chairman said estate workers were given facilities which workers in other sectors did not get.

“We provide crèches and health facilities which a normal labourer in other sectors wouldn’t get. The workers live on the estates. So there is no transport cost as such. So it is unfair to demand such a high wage hike,” Mr. Perera said.

But Minister Thondaman scoffed at this claim, saying the plantation companies did not do much and it was the government which was looking after the welfare of the workers.

“My ministry has done a lot for the estates. The Housing Ministry, the Education Ministry and other ministries have also done a lot of work on the estates.”

Asked whether the government would intervene to sort out the dispute, the minister said the government believed the trade unions and the RPCs could work out a solution. “The government does not want to intervene as it may be seen as putting pressure on one side or the other,” he said.

However, Mr. Thondaman said if there was no breakthrough in the talks, then government would be forced to intervene. “It will have to be tried as a labour dispute under the labour commission,” he said.
On Wednesday, Minister and UPF leader P. Chandrasekaran called on the President to intervene in the dispute, reminding him of how he sorted out a similar dispute in 2007.

But the RPCs said they were not in favour of government intervention, saying it should intervene only to maintain law and order on the estates. “The situation on the estates is becoming unruly. The workers are preventing the processed tea from leaving the factories and reaching the buyers. The government should take action against these workers,” Mr. Perera said. He said the Planters Association feared that foreign buyers would go to other markets if “we do not meet their orders.”

“If the trade union action continues, it will delay the plucking rounds. The tea leaves will get matured and the quality of the tea will get affected. This again will have a bearing on the production,” Mr. Perera said.

Thonda says no role for govt, insists on Rs. 500

Minister and Ceylon Workers Congress Leader Arumugam Thondaman said there would be no let up in their trade union action until their demand of a Rs. 500 daily wage was met by the companies.

“We will carry on the struggle till the demand is met,” he said. The minister said that his trade union was focused on the demand, unlike the rival Upcountry People’s Front which he alleged was only talking. “One day they say they want Rs. 600. The next day they wake up and say they want more. They are not sure what they want,” he said.

Thondaman addressing a news conference on Thursday night. Pic by Ranjith Perera

Mr. Thondaman said he also did not agree with the UPF’s call for a presidential intervention in the crisis.
“The president should not get involved in a trade union matter. As a union we can show our power and get our demand and we have been doing so and we will continue to do that,” said Mr. Thondaman, who is the minister of Youth Empowerment and Socioeconomic Development.

He said that as a member of the government he believed the government should be doing more to improve the welfare of the estate workers. “We are part of the government. But we don’t have total control.

For instance, if we want to build houses on the estates, the National Housing Authority should pass the money to the Plantation Human Development Trust. It takes a long time for the money to come. We admit that what is being done is not enough but things will improve,” Mr. Thondaman said.

Commenting on the extreme poverty prevalent in the estates, the minister said he believed the people themselves should be blamed for the situation. “The poverty level has increased I am aware of it. But for this, the estate people are also responsible.

They are not keen on improving their situation. For instance, the level of alcoholism and the cases of abuse have increased drastically. There are so many liquor bars in the estates and most workers end up there after work,” he said.

Mr. Thondaman said his ministry had conducted several self employment training programmes in the estate sector but not many had benefited from them.

“They want to come to Colombo. Of course we have no problem with that. But many of them end of doing menial jobs and get a small salary, whereas, they could earn a lot more if they stay in the estates,” he said.

Mr. Thondaman also noted the school dropout rate in the estate sector was also high and a programme was being carried out to encourage children to continue their studies.

CWC and other trade unions deceiving the people: UPF

The Upcountry people’s Front says it demands that Rs. 500 should be the basic wage -- not an all inclusive wage as demanded by the CWC and the other two trade unions which are signatories to the collective agreement.

“Even now the people do not get a Rs. 290 basic wage, Most of the time, they get only Rs. 220, that is the basic wage of Rs. 200 and the price-share supplement of Rs. 20 -- nothing more. Most of the time, the take-home salary will amount to only Rs. 3,000 or Rs. 4,000 a month. We demand that the workers should be given a minimum wage of 500,” said P. Radhakrishnan, Deputy Vocational and Technical Training Minister, who represents the Upcountry People’s Front and the Up country Workers Front.
He charged that trade union signatories to the collective agreement were trying to deceive the estate workers and the people would soon come to know about this.

“If they get some thing close to Rs. 500, the first wage they get with the festive allowance for Deepawali will be quite a substantial amount. They would feel that they have won a huge wage increase. But that is not the real picture. The three trade unions that are negotiating with the RPCs are not able to win their demand.

They should not agree to anything and leave room for the other unions to fight for the demand. If they sign the agreement for a lesser offer, then they are betraying the very people they represent,” Mr, Radhakrishnan said. He also charged that the RPCs did not provide facilities to estate workers.“All facilities such as health care, education and infrastructure are being provided by the state,” he claims.

“All the RPCs have to do is to pay a decent wage to these people. The land is owned by the state and they cannot claim that the housing is provided by them. After all those line rooms were built 150 years ago by the British,” Mr. Radhakrishnan said.

Noting that even the government had acknowledged that the poverty rate in the estates was high, the deputy minister said the poor standard of living in the estates was a direct consequence of the low wage the workers received.

“The educational level of children in the estates is poor. The recent deaths of the two domestic workers shows what kind of a plight these people are in. A family cannot survive on the salary given by the estates alone. That is the reality,” he said.

Mr. Radhakrishnan said he believed that the state had a bigger role to play in improving the condition of the estate community. On the debate of whether or not the government should get involved in the ongoing negotiations, he said President Mahinda Rajapaksa should intervene and pointed out that even in 2006 it was the President who intervened and got a salary increase for the estate workers.

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