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Key collective bargaining agreement signed in Sri Lankan free trade zone

28 July, 2016IndustriALL affiliate the Free Trade Zone and General Services Employees Union signed an important collective bargaining agreement with Trelleborg Wheel Systems Lanka.

Sri Lankan free trade zones are one of the most difficult areas in the world for trade union activities and organizing workers. But despite workers facing severe anti-union and unfair labour practices from employers, IndustriALL affiliate the Free Trade Zone and General Services Employees Union (FTZ& GSEU) won a successful collective bargaining with Trelleborg Wheel Systems, the Sri Lankan subsidiary of a Swedish multinational manufacturer of tyres for agricultural and industrial machines.
The agreement, which covers about 140 workers in the factory, states that the employer will respect the right of each employee to become a member of the union, and prevent discrimination of employees due to union work.
The employer also agreed to create material and organizational conditions for union activity, including holding union meetings within the factory premises and time off for union office bearers to participate in union activities if notice is given. The union committed to carrying out its activities in a way that will not disturb the working time nor restrict the activity of the employer.
The agreement was signed on 13 July 2016 and is retrospectively applicable for the period of 2014 to 2018. On fixing working hours, the company will discuss with the union and after reaching consensus the decision will be implemented by the management. It guarantees all statutory benefits on wages and working conditions and on certain provisions it goes beyond those statutory entitlements.
While the agreement is valid for four years, annual salary revisions will be negotiated with the union every year. The union will also participate in the process of job evaluation, which includes skills, knowledge of work and attitude, based on which a wage structure will be decided upon. The agreement also provides a non-recurring cost of living gratuity for workers, which is not offered by many companies in free trade zones.
The agreement also elaborates in details on the employer’s responsibility to ensure safety at work and the prevention of accidents at the workplace. It includes a commitment from the employer to educate workers on safe working methods, and avoiding the use of toxic chemicals in the production process. The company will pay for an annual trip for the employees, which is an extremely rare benefit in free trade zones.
Another key provision is that the company will reimburse medical expenses incurred by employees and their immediate family members up to 10 % of annual basic salary to a maximum limit of Rs 13,000 (US $88). Employees will also be covered by surgical and hospital expenses insurance to the value of Rs.40,000 (US $268) per annum.
Congratulating workers and the employer, Anton Marcus of FTZ & GSEU said:
“The agreement is major achievement against the backdrop of the hostile and anti-union environment faced by workers in Sri Lankan free trade zones. It will go a long way in building a healthy industrial relations with the employer and addressing workers’ concerns.”
Apoorva Kaiwar, IndustriALL regional secretary said:
“We are very pleased that our affiliate has negotiated this excellent agreement. Some of the provisions, like allowing the union to hold meetings on factory premises and welfare benefits like paid holiday travel for workers are groundbreaking.
Having a collective agreement in a free trade zone is in itself an achievement. This provides a healthy working environment for Trelleborg employees.”