COVID-19 hit exporters want financial assistance to pay workers for 3 months

• NCE writes to Minister Dinesh Gunawardena on labour issues faced by exporters amidst pandemic

The National Chamber of Exporters (NCE) has called on the Government to financially assist them to pay basic three month salaries to sustain their labour force, while also insisting some revisions in laws and regulations.

As the only private sector chamber which exclusively serves Sri Lankan exporters, NCE Secretary General and CEO Shiham Marikar met with Skills Development, Employment and Labour Relations Minister Dinesh Gunawardena to discuss the employment issues faced by the export community due to the COVID-19 pandemic.

The NCE pointed out that the prevailing labour laws in Sri Lanka were heavily in favour of employees and prevented flexibility with regard to employment of labour in crisis situations and stressed on the need to revise some laws and regulations to overcome the current situation. 

Emphasising on the vital contribution of exports to the national economy, by earning much-needed foreign exchange and providing employment, he noted that exporters were now faced with an unprecedented issue due to the cancellation of orders by buyers even for goods that had been made ready for shipment in some instances.

While some buyers are requesting discounts for goods already shipped, some others are even refusing to pay and accept shipments that have arrived at their destinations. Under these circumstances, to sustain their labour force, the exporters sought Government assistance to the payment of even a basic minimum wage for a period of three months.

The proposals of the NCE given to the Minister are listed below. 

*Due to very low order values, some exporters may only require a part of the labour force in production of particular order. In such situations to permit the exporter to use only the required number and pay wages on a piece rate or terms agreed with the employees.

*Due to very serious cash flow problems, it is recommended the suspension of payment of EPF by both employers and employees for a period of six months. 

*At times of servicing an order with reduced number of labour, will necessitate to work extended hours, in addition to the normal shift. In such situations it should be permitted to continue within reasonable hours of work without engagement of the next shift of employees to be cost effective.  

*In order to catch up on lost time and to stay ahead of deliveries during these challenging times it may require working on holidays and Sundays excluding religious holidays such as Poya days. This to be permitted with only payment of required dues and without giving any lieu leave.

*Exporters should be encouraged with legislation to operate productivity base incentive schemes at their places of work to have better outputs and increase employee take-home wages.  

*If subcontracted production is required the exporter should not be held accountable for any labour issues at the subcontractors’ place of work. 

Further it was emphasised that the entrepreneurs and business leaders in the export sector were fully aware of the challenges and difficulties faced by the Government on many fronts due to the COVID-19 crisis and their good intentions in submitting the above proposals were to help the Government ensuring their own survival to achieve quick economic revival of the country. This no doubt will be of paramount importance to the Government to avoid a worse crisis economically.

It was stressed that the business leaders of the export enterprises had with difficulty maintained their workers during the month of March. However many of them, including some large enterprises are confronted with the need to lay off workers from the end of April, as there are no revenue streams for their sustenance.

If this happens, given the stringent labour regulations of the country, possible actions of the labour unions, and protests by the workers themselves, could lead to a catastrophic outcome which will be a severe setback to the country.

In order to avoid such a situation, the NCE is pleading with the Government to move the relevant State authorities to initiate immediate action to resolve the prevailing labour issues. “This should be a priority as we are only a few days away from the end of April, with no meaningful effort in sight to resolve these vital issues, which involve the livelihoods of many.”