Wage issue of the plantation worker

Dr. A.S. Chandrbose

Plantation workers are demanding daily wages be increased to Rs.500/= from the current rate of Rs.285/= per day to meet the minimum requirements of existing cost of living in the country. Any changes of the wage structure of the plantation workers will be decided at the Collective Agreement (CA) which has been the practice from 1996. The members of the CA are the representatives of Trade Unions of the plantation workers and that of from the Employers Federation. Recently they have met and rescheduled the meeting to be held towards the end of April 2011. Though, there is a necessity of increasing the daily wages, the Employers Federation has made the announcement that the workers are receiving between Rs.10,000 to Rs.12,000 per month and the level of poverty has come down upto the  national average of 9 per cent. This indirectly tells that there is no need for wage increase for the plantation workers. 

The 140 year-old tea industry has been contributing immensely for the development of the social welfare sector until the 1970s and today it is an important sector of export earnings, but unfortunately the country is not in a position to bring them to the level of the average man and women who have living in the rural sector of the country.  

Though the workers also demanded for Rs.500/= per day previously in 2009, finally it was agreed to pay only for Rs.290, but giving Rs.285 only as the basic wage. It is also decided to provide an attendance intensive of Rs 90/= adding to their daily wage if they attend more than 75 per cent of the work offered to them per month by the estate management. And Price Share Supplement of Rs. 30/= (which makes Rs 405/=) made only a publicity agreement. Accordingly, the workers who work for 30 days (30 x Rs.405= Rs.12,150/=) are able to receive this amount  as the calculation made by the Employers Federation. But opportunities for work in all 30 days are limited only for the workers who work as estate watcher, bungalow servant, peon, health workers and factory workers in limited cases. This type of work is performed only by less than 10 per cent of the labour force in the tea estates.  The bulk of the workers are field workers and facing number of hurdles to attend more than 75 per cent of work offered by the estate management.

The tea workers desire to work according to the norms set in the CA by attending more than 75 per cent of the work offered by the estate management. However, it is not an achievable task for several workers in the estates. Though the estate management expected to turn a minimum of 19 days which could be calculated for the provision of Rs.405/= per day, it seems a terrible task for the workers. If the workers lose one day out of the 19 days of work it will be calculated to be less than 75 per cent of the turn out and subsequently will be given only Rs.285/= per day. Apparently low wage through losing a day leads to a certain level of frustration among their life of the estates workers.  

However, the estate management is having a difference of opinions about the distribution of wage income to the workers. Accordingly, as mentioned above they still believe that a worker receives an average of Rs.12,000/= per month. It is also imperative to discuss about the actual structure of the wage income of the tea workers in the country. The followings are compiled from pay slips of the tea workers which were given by the respective tea plantation companies. The classification of wages has been made on the basis of the average income that they have received during the last quarter of 2010. 

The figures on wages are the distribution of actual wage income of the workers before the deductions. Generally the deductions are made for monthly advance payments, EPF, subscription for trade unions, loans, contributions for dhobi and barber, and the expenses that incurred in preparation of pay slips by the estate managements etc. The deductions are ranging around Rs.1, 100 for the bottom line income receivers which make 25 per cent of the worker population. The total deductions for others are ranging from Rs.1,700 to Rs.3,700 per month. It is clear that 25 per cent of tea workers are receiving lower wages of between the Rs 3,000/= and Rs.5,500/=. Around 45 per cent of the tea workers have been receiving between Rs. 5,501/= and Rs. 8,500/=. The workers who are receiving between Rs. 10,001 and Rs.11,500 per month are only 10 per cent of total workers in the estates. 

 Apart from the wages the tea estate companies are also repeatedly saying that they are making losses after losses every year.  The losses are mainly due to the labor cost. But, there is no substantive analysis of labour cost in the context of plantation management companies. For example the tea workers contribute to around four kilograms of made tea through plucking of a minimum of 16 kilogrammes of green leaves per day. The final production of manufactured tea was sold at Rs. 320/= at the Colombo Auction in 2009 and thus the workers contributes (4 kilogram x Rs.320/=) Rs. 1,280/= worth of production per day. If we estimate the maximum labour cost to be Rs 405/= of wage, including other contributions (EPF, rent for free houses, values for medical facilities, gratuity etc.) it will cost Rs.500 per worker daily. This calculation shows that still the management is in the safe side in terms of making profits for it receives Rs.780 (Rs.1280 – Rs 500) as profit out of the total contribution of a worker per day.

Indeed, the estates companies are producing around 35 per cent of the total production of tea and the remaining 65 per cent of tea comes from 300,000 tea smallholders, mainly cultivating the tea in the districts of Ratnapura, Galle and Matara. Most of the tea smallhoders possess their own tea lands for cultivation. Those who are cultivating the tea in the extent of 1/8 hectare of smallhodings are able to earn a minimum of Rs. 20,000 per month. The tea small holding authority is providing necessary patronage for the development of the tea smallholders in the country. But the activities of large scale to tea estates are totally different from the smallholdings of tea in the country.


Dr. A.S. Chandrbose is a Senior Lecturer in Social Studies at the The Open University of Sri Lanka

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