If promises are kept, ‘living wage’is the best news for workers

It was almost like panic buttons being pressed this week by the two main contenders at tomorrow’s parliamentary poll – United National Party (UNP or UNF) and the United People’s Freedom Alliance (UPFA) – as they rolled out a list of dos and don’ts.

A series of benefits, incentives and long term solutions were offered mainly by the UNP-led government while the UNPA made its own set of promises.

Prime Minister Ranil Wickremesinghe promised to bring in laws, a request by trade unions, to compel the private sector to pay a monthly wage increase of Rs. 2,500 to its employees as announced in the 2015 interim budget. While the increase was implemented by the public sector, the wage hike was announced as ‘a request to implement’ in the case of the private sector. It was also stated that the move would enable workers getting a living wage, another strong call from the unions particularly those representing free trade zone workers.

While this is no doubt happy news for private sector employees, the fact that the promise was made during the last week of campaigning clearly meant it was to woo votes for the government.

Similarly this week’s ‘political’ announcements included an assurance to the garment sector that GSP + concessions would be available by next year, the creation of a new island-wide ambulance service with Indian Government support, the entry of a new factory by world-famous Volkswagen, among others.

On the political front, the Janatha Vimukthi Peramuna (JVP) appears to be making strong strides under its charismatic leader Anura Kumara Dissanayake and many exit polls point to a good showing by the party, making it a third decisive force in local politics and a formidable opposition in parliament to keep in check whichever party – the UNP or UNFPA – controls the house.

Sri Lanka has been lacking a vibrant opposition party for many decades with the two main parties being too narrow minded, inward looking and selfish rather that defending the people’s rights. A strong opposition is what the country needs at this juncture under a conciliatory and accommodating President.

Aside of the wage hike which would benefit nearly 7 million workers (1.3 million of the total workforce of 8.4 million represents the public sector), the promised resumption of GSP + concessions is a positive step as long as workers are also made beneficiaries in this exercise.

These concessions would not only boost earnings of garments manufacturers but also create new markets or a possible resumption of an old client base that was lost when the concessions ended in and around 2010.

The European Union accounted for more than 50 per cent of garments from Sri Lanka during the period of GSP + concessions but this dropped when Sri Lanka fell off the list of eligible nations due to the inability to meet requirements under ILO rules which included the freedom of association (trade unions in FTZ factories). Only a few companies permit unions while others stick to the BOI-regulated Workers Councils which unions complain are topheavy with company-backed employees.

While the garment sector is positive that a new round of GSP + concessions would boost earnings and in turn provide a trickle down benefit to workers, garment sector employees and unions that represent them are not so sure.

Padmini Weerasooriya - Executive Director Women’s Centre, Ekala, and President of the Women’s Solidarity Union (WSU), says - more than anything else - workers are yet to get the benefits of companies making huge profits. “There are serious problems pertaining to rights, freedom to have unions, increased workload without a reciprocal increase in wages, appalling living conditions in hostels, and many other issues,” she said adding that expected increased earnings to factories from fresh orders (when GSP + takes effect) should also be passed to workers and not retained totally by management.

She and other groups campaigning for the rights of female garment sector workers said while earnings of garment factories have risen despite the loss of GSP + concessions, such benefits have not trickled down to workers who are producing more per day with higher daily targets while wage-wise nothing has changed.

In an October 2012 Business Times editorial titled “Sri Lanka: From tailor-shop to own brands”, it was stated that “while ethical production is the order of the day, and demanded for, by the big labels, the struggle between management and workers through unions, for what is called a ‘living wage’, continues unabated. Wages is a sore point in any sector and eventually worker representatives and management need to strike a balance between a decent wage and decent profits. No producer can survive on very marginal profits with costs rising all the time; on the other hand, workers also need a wage that is consistent with the demands of daily life. Managing these needs is the order of the day and both sides eventually have to compromise rather than confront. With Sri Lanka’s ‘tailor-shops’ emerging as producers of their very own labels in a highly competitive international marketplace, one hopes this positive development will pave the way for a smoother relationship between workers and owners. Workers should also share the success of Sri Lanka’s own labels.”

The garments sector has been the story of workers, a group of dynamic entrepreneurs using Sri Lankan skills to position Sri Lanka as a competitive production base, and the advent of new technology. Companies have made huge profits and there’s nothing wrong in that. But what is wrong is that workers are yet to get what is defined as a ‘decent, living wage”. It is then incumbent on the new government, formed after tomorrow’s election and steered by President Maithripala Sirisena, to make sure a ‘living wage’ based on accumulated profits is a reality and not a distant dream that Sri Lankans have come to accept in election promises made in the past.