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Sri Lankan workers struggle due to high inflation

27 October, 2022At a living wage workshop held in Colombo on 20 October, trade unionists expressed concern over workers not being paid a living wage in the country. 

Trade unions are demanding that the national minimum wage be increased to 26000 LKR (US$ 71) but the government has not budged.

Food inflation rose to 95 per cent in Sri Lanka in September while wages remain stagnant. In some factories, workers are being paid as low as 16000 LKR (US$ 44) which is the national minimum wage. Wages for migrant workers in free trade zones are insufficient to pay for housing. The ongoing wage crisis in the region has taken the worst form in Sri Lanka, which is yet to recover from an unprecedented economic crisis.

Before the crisis workers were able to stay afloat despite low wages because of overtime pay, attendance bonus, transport facility and other incentives; however, since these benefits were discontinued, the take-home pay has decreased drastically. Companies are citing low orders as a reason for taking away the incentives. 

Workshop participants made it clear that to overcome the challenges unions need to ensure a living wage by building union power on the ground and fighting for decent wages collectively. Unionists discussed mechanisms such as sectoral bargaining, global framework agreements and tripartite forums, that must be used effectively to campaign for a living wage. 

Global apparel brands’ representatives who were present at the roundtable held on 21 October to discuss the need for a living wage, shared that currently, the garment industry is operating in survival mode due to high inflation across the globe. 

Manufacturers in Sri Lanka are facing tough competition from other South Asian countries that are keeping prices low and acheiving on-time delivery. Brands assured that they will keep the factories running in Sri Lanka for workers to keep their jobs. 

Anton Marcus, joint secretary of IndustriALL affiliate Free Trade Zones & General Services Employees’ Union, says:

“Brands must fulfil their social responsibility by ensuring that orders are not stopped. If manufacturers cannot pay a 10000 LKR (US$ 27) Economic Relief Allowance to workers, then brands should support the manufacturers. This is the time to show solidarity with Sri Lankans.”

The necessity for an industry-wide change in the apparel industry to guarantee that workers receive decent wages was acknowledged by both unions and brands.

Apoorva Kaiwar, south Asia regional secretary of IndustriALL, said:

“Trade unions are clear that wages need to increase across the country and especially in the RMG sector which employs a large number of women workers, many of whom are single mothers. We need an industry-wide bargaining mechanism to achieve that. We call upon brands and manufacturers to engage with trade unions to discuss industry-wide wage bargaining in the apparel sector.”