Wage issue from the plantation workers’ perspective

The increase in plantation wages has been in the news once again. Reports in the English language press focused on the justification for the wage increases, especially in the context of rising cost of living, but also raised questions about the impact of the increased cost on the viability of the sector. However, what has been lacking in much of the discussion is the impact of the plantation sector’s structure on worker productivity, and why both women and men on the plantations, particularly youth, are often choosing not to maximise their potential income on the plantations by using the guaranteed 25 days of work.

In 2005, the Centre for Poverty Analysis (CEPA) carried out a study to understand why poverty levels in the estate sector continue to rise. The study gave an in-depth analysis of how poverty is perceived and experienced by workers within the tea and rubber sectors, and underscores the message that the structural form of the sector is the core factor stifling development and inhibiting improved worker productivity.

The structure of the estate sector is a hangover from the ‘plantation system’ initiated by the British in the late 19th century. Originally brought over as indentured labour, the Tamil people working on the estates have lived within the boundaries of the estate for several generations. Despite a major shake up in June 1992 with the re-privatisation of management to improve commercial viability, management is still to this day expected to maintain the workforce from ‘cradle to grave’ as was the case in the traditional colonial structure. The concept of ‘resident labour’ means management is responsible for housing the workforce and their families, and binds workers to the estate not just as workers, but also as residents. It is a concept that blurs the boundaries between work and home, and gives management a high level of control over every aspect of the resident labourer’s life.

Working outside the estate is discouraged by management, who argue, rightly, that it is possible for workers to earn a living wage by working on the plantations. Workers that we talked to agree, but nevertheless feel strongly that they are exploited and forced to stay on the estates, mainly because the estate provides their housing, a strong example of the structural tension within the plantation system. The perception of the labour force is that the plantation system is marginalising them, preventing them from participating in the mainstream socio-economy as well as the socio-political system of the country. They see themselves excluded from the benefits that have accrued to the rest of the country and many have a strong desire to find employment outside to ‘escape’ the sector.

“Half the estate youth work in Colombo and nearby towns. The management does not give us proper work on the estate, but they don’t like us working out either. They threaten to take back our houses if we don’t come back and work, so some of us are forced to come back and work on the estate,” – one youth from a rubber estate in the Kegalle district.

The adversarial/dependent relationship that the labour force has with management creates a convoluted picture of whether or not external employment is actually needed for escaping poverty, or whether it is just a means of escaping the system. This is an important question when considering how effective wage increases will be in terms of improving workers’ living standards as well as productivity.

Although a large number of estate workers’ households may hover around the national poverty line, there are households that have moved out of poverty - not just in terms of earning higher incomes, but also in terms of the workers’ own definitions of poverty which go beyond income levels. Almost all of these are households that do not rely solely on the estate for income, taking on non-estate work during the low season as well as some members of the household taking full time jobs outside the estate. Diversification of household income sources, especially by working overseas (typically in the Middle East), is the most popular and most successful way of achieving upward mobility.

“We developed with our own effort, no drinking, house is well-constructed. I earn about Rs.8500 tapping rubber. From the money my wife sent from the Middle East, I started the shop and bought the three wheeler from the money saved from rubber tapping,” said a 40-year old male rubber tapper in the Kegalle district, describing his escape from poverty.

There are, of course, other factors that help and hinder workers’ movements out of poverty. The constant rise in the cost of living, often much faster than wage increases, is seen as the strongest factor in preventing upward movement and creating stagnation. This is important in the context of the recent demands for higher wages in the current high inflationary environment. However, workers also emphasise that changes since re-privatisation, such as increases in productivity requirements and reduced availability of work, have affected earning capacities. Chances for households to increase their standard of living are greater in circumstance where the estate is successful, but external employment can help households even in deteriorating plantation environments to escape poverty.

The members of successful households make sure, however, to maintain some level of estate work in order to maximise the advantages of the plantation system package of benefits. In contrast, households that are stagnating or descending into poverty see estate employment as restricting freedom. They are frustrated and dissatisfied with the lack of choice.

“The management of the estate can change these things. If not the head office in Kandy or Colombo can. Failing the estate, the ministry can do something. The government gets the biggest profit out of the estates. But we are not even considered as human beings. We don’t know whether they consider us not good enough to change anything,” according to a group of male workers in a state owned tea plantation in Kandy.

This perception of marginalisation and exploitation is in itself a non-economic dimension of poverty. Even households that have incomes significantly higher than the poverty line feel strongly that they are members of a sector that is being given a “raw deal”. The structure of the plantation system today creates feelings of resentment among the workers, which in turn influences the economic decisions that they make. The problem of resident labour not providing sufficient days of work to the estates to which they ‘belong’ can be understood as a desire to escape from work that they see as marginal and disempowering. This highlights that longer term solutions to the problem cannot be based on wage increases alone.

CEPA’s work suggests that the key to reducing poverty on the estates lies with fundamental changes within the plantation structure. This structure is gradually collapsing so the answer may lie with allowing this trend to develop and progress over time. A more radical solution is the proactive dismantling of the ‘cradle to grave’ relationship between workers and management, replacing it with a more conventional employer/employee relationship.

The latter option would require de-linking housing and employment, shifting the responsibility for the social development of the workers and their families to the state (as with the rest of the population), and creating a more positive image of plantation work to attract non-resident labour.

This could lead to a more diversified workforce in the sector while providing the Tamil people resident on the estates more opportunities in the rest of the Sri Lankan economy.