Labo ur La ws an d P ol icy

Rec ru itm en t a nd Ret ir eme nt

The minimum age for recruitment is 18 years and the normal age of retirement is 55 years. However, extensions beyond
55 years can be granted at the discretion of management.

Eq ual Sta tu s
There should be no discrimination between male and female workers in terms of remuneration and facilities.

Con tract an d E mplo yme nt

A written contract of employment embodying terms and conditions of service including the designation or category of the
employee, normal hours of work, rate of pay, period of training if any, probationary period, leave, holidays and
superannuation contribution, has to be issued to every worker including trainees, and acknowledgement of receipt
obtained by the employer.

On termination or resignation any certificates in the custody of the management should be returned to the worker at least
within 30 days from the date of termination/resignation.

No rm al W ork in g Da ys a nd N igh t W ork

Normal W orkin g Da y
One-Sh ift Ope ratio n: Monday to Friday: 9 hours per day inclusive of an interval of one hour.
Saturday: 6½ hours inclusive of an interval of one hour.
Two Th ree- Shif t Monday to Friday: 8 hours per day inclusive of an interval of half an hour.
Ope rati on:
Saturday: 5 ½ hours inclusive of an interval of half an hour.
For office employees, Saturday is a half day of 5 hours duration

Nigh t W ork
There are no restrictions on employment of male workers on night shifts. Employment of female workers on
night work from 10.00am on the following day will be allowed as a third shift, subject to certain conditions:

Ov er time Rem un er at ion

Any work performed in excess of the normal working day to be treated as overtime work and shall be remunerated
accordingly. Every hour of such work should be paid at 1 ½ times the normal hourly rate of wages, which is determined
by dividing the monthly rate of wages by 200. In calculating hours of overtime employment, any fraction of an hour less
than ½ hour shall be treated as half an hour. Employees working on Sundays and Poya days should be paid 1 ½ times
the daily wage rate. If an employee works beyond the normal working day on a Sunday he/she should be remunerated at
double the daily wage.

Lea ve

Vaca tion (A nnu al Lea ve)

An employee shall be granted a 14-day vacation leave with pay from the second year of employment onwards if he/she
has been continuously in employment during the year.

Ca su al L ea ve
An office employee has to be granted 7 days casual leave with pay from the second year of employment.

Si ck Lea ve
Sick leave to be granted at the discretion of management. Some enterprises grant such leave up to a maximum of 21
days. Employee must produce medical certificates to cover such leave.

Ma te rn it y Le ave
a) A female factory employee shall be allowed 12 weeks (84 days) paid leave in addition to other paid leave/holidays she
is entitled to if the employee gives birth to a baby and the employee has no other children or has one other child.
b) In case she has two or more children or in the event she miscarries the employee shall be allowed 6 weeks (42 days)
paid leave in addition to other paid leave/holidays she is entitled to.

Su per an nua ti on Be nef it s

Empl oy ee s P rov iden t Fu nd

An amount equivalent to 20% of the employee's total earnings has to be remitted to the Fund before the last working day
of the succeeding month in respect of all employees.

An employee's contribution to the Fund is 8% and the employer has to contribute an amount equivalent to total earnings.

Payment for work done on normal working hours on weekly holidays, poya days or public holidays should be considered
for the computation of EPF and ETF contributions.

Empl oy ee s T rust F und

Employers are expected to remit an amount equivalent to 3% of the total monthly earnings of the employee before the
last working day of the succeeding month. There is no contribution from the employee.

Gr at uit y
An employee who has completed five years' service shall be paid a gratuity on cessation of his employment irrespective of
whether he has retired or resigned or his services have been terminated by the employer. Such gratuity shall be computed
at the rate of half a month's salary for every year of completed service based on the consolidated salary last drawn by the
employee. Payments should be made within 30 days of cessation of employment. An enterprise, which employs fifteen or
more workers, is liable to pay such gratuity.

Term ina ti on o f Ser vi ces

Dis cipli na ry
An employer can terminate the services of an employee on disciplinary grounds (e.g. misconduct, fraud, refusal to carry
out lawful orders) provided the normal disciplinary procedure has been followed. For wrongful termination of services an
employee can seek redress in the Labour tribunal before the expiry of 6 months from the date of such termination.

Non -dis cipli na ry

In the case of workers who have been in employment for more than one year, lay-off, retrenchment or termination of
services for reasons other than on disciplinary grounds can be effected only with either the prior written consent of the
worker or the prior written approval of the Commissioner of Labour. Such approval will be granted after due inquiry. On
cessation of employment, a worker should be issued with a letter with a reason for such cessation and a service
certificate for a period of his employment.

Indu str ia l Dis pu tes

Any dispute or difference between the employer and employee should be promptly brought to the notice of the industrial
relations department of the BOI so that such disputes could be resolved.

Whenever lay-off, retrenchment, closure or termination of services of employees due to no-disciplinary reasons become
necessary, requests should be made in advance to the industrial relations department of the BOI so that suitable
arrangements could be made.

Emplo yee 's C ou nci l

Every enterprise should establish an Employee's Council with the concurrence of the Industrial Relations Department of
the BOI. The Council should consist of 5-10 members representing different departments of the factory. The Electoral
Board of the BOI will conduct the election to elect members to the Employee' s Council. Any disputes that cannot be
resolved through discussion should be brought to the notice of the BOI.
Role o f BO I

Th e I ndus tr ia l R el at ion s D ep art me nt o f t he Boa rd o f I nves tm ent of Sri L an ka ad vis es an d

as si st s en ter pri se s t o m aint ai n a pe ac ef ul a nd h arm on iou s i ndu str ia l re la ti ons si tu at io n.
Pers on nel f rom th is D ep art me nt w ill vis it t he e nt erpr is es an d g uid e t he in vesto rs o n al l
as pe ct s i n th e a rea of i ndu st ri al r el at io ns . E nt er pri se s s ho ul d br in g to t he no ti ce o f t he
De par tm en t an y d ifficu lt ie s, dis pu te s or p ro blem s f ace d by th em so t ha t th ey cou ld be
re so lv ed sp ee di ly.