Extra EPF would cost Rs.466.6 mln more to reeling SL plantations
View(s):The additional 2 per cent EPF payment to workers as decided in the 2015 budget will cost Sri Lanka’s already-reeling plantation companies a staggering Rs. 466.6 million annually, the Employers Federation of Ceylon (EFC) has said.
In a November 25 letter to Gamini Lokuge, Minister of Labour and Labour Relations and copied to the media, EFC Director General Ravi Peiris has said that this sudden impact on employers is bound to have serious implications. The issue was also raised at the National Labour Advisory Council meeting held on November 13.
“As you know, the Regional Plantation Companies are currently operating under severe constraints and an enhancement of this nature will only result in aggravating the difficulties,” he has said.
Mr. Peiris has noted that in general private sector employers are one of the leading contributors in relation to superannuation schemes and even unemployment benefits compensation comparable with other countries in the region.
“Currently an employer contributes 12 per cent of an employee’s earnings in respect of EPF, an additional 3 per cent in respect of ETF and over and above these contributions a gratuity payment is made to all employees who have completed five years continuous employment with an employer, on cessation of employment. Above all, Sri Lanka also has one of the highest compensation formulae in relation to retrenchment compensation under the formula gazetted by the Commissioner of Labour in terms of the Termination of Employment of Workmen (Special Provisions) Act No.45 of 1971 (as amended),” the letter said.
Mr. Peiris said that at a time when the country is looking for more investment and employment generation, changes such as these are bound to be counter-productive. “In the circumstances, we wish to place on record our serious reservations in bringing about any changes to the existing legislation right now to implement these proposals,” he has said.