High Time to Modify Labour Laws, EFC Survey Reveals
By Rajiesh Seetharam
Labour market-related policies were identified as the most important area that the Government needs to address, according to survey findings by the Employers’ Federation of Ceylon (EFC). The survey report further noted that the hospitality and food service sector recorded the highest economic losses in terms of revenue, foreign exchange earnings and investment.
The EFC conducted a survey from a sample of 100 employers in April-May 2020 to identify the impact of COVID-19.
“Sri Lanka’s existing labour laws do not take into consideration pandemic like situations, leaving a huge gap in institutional mechanisms to manage crises of this nature,” noted the research report.
As per the findings, some of the major policy interventions that firms have suggested for the key policy interventions are promoting work-from-home, flexible working hours, less Government intervention on salaries and other payments (particularly in the plantation sector), introducing Government-sponsored wage payment schemes, setting off the non-working days due to lockdown against employees’ leave entitlements, granting permission to delay contributions to the Employees’ Provident Fund (EPF)/Employees’ Trust Fund(ETF) and modifications to the existing labour laws, particularly in the areas of lay-off of employees, payments of salaries and other statutory entitlements.
On the road to economic recovery from the COVID crisis, employers suggested Monetary and Fiscal Policy interventions from the Government, like the reduction of interest rates, extension of debt moratoriums, and granting credit and other financial support as means to improve cash flow and restart business operations.
Employers further requested the Government to provide tariff reliefs on exports and imports of raw materials, and the removal of cess and other para-tariffs on the importation of critical inputs to production.
Speaking at a press conference, EFC HR and Research Coordinator, Dinesh Ruwan Kumara stated that the survey findings revealed more than half of responding firms faced serious cash flow problems in meeting day-to-day expenses, while 18 per cent of companies stated that their cash flow was sufficient for only one month, and another 39 per cent stated they could survive for about three months.
According to the findings, exporters employing above 250 employees lost all their earnings. This could have serious impact on the Balance of Trade, as large scale firms account for 95 per cent of total export earnings.