- Warns other trade unions may be tempted to get salary hikes included in Budget
- Says listing out salary in Budget undermines collective bargaining process adhered to for decades
- Insists gratuity and productivity issues must also be resolved
- Concerned proposal made without considering market realities
The Government could be opening a Pandora’s Box by mandating a wage in the Budget, a top plantations industry expert said yesterday, warning that it ignored market realities and the collective bargaining system practiced by the sector for decades.
Sunshine Holdings Group Managing Director Vish Govindasamy, responding to questions as part of the KPMG post-Budget conference, opined that including the plantation wage in the Budget was an unwise step by the Government, as it created space for other trade unions to demand the same.
He also pointed out that the Budget proposal ignored connecting the daily wage with productivity targets and undermined the collective bargaining process, which includes trade unions, plantation companies and the Employers Federation, which has existed for decades.
“This is the first time a wage has been mandated by the Budget. This will open up a Pandora’s Box where other unions will want to get salary increases via a Budget. This proposal also raises questions on the productivity component and the gratuity issues. In the plantation sector, even if a worker comes to work for a day, gratuity has to be given for the entire year, and these are huge amounts. We have been talking with the Labour Ministry to revise gratuity for a while now.”
Govindasamy also argued that if the Government wanted to set a mandated salary, then it should also set a minimum price for tea, which would be unrealistic as tea was sold at auction and adhered to international market changes. Given that there is less chance to predict prices, he pointed out it was impractical to have a set salary for plantation workers when the market and industry had become more volatile due to COVID-19.
“I don’t think it’s the right thing to do, especially when the leader of the union sits as a Cabinet Minister,” he added.