Labour drain from plantations

By Chandani Jayatilleke

Tea is now a hip beverage with much hype over its health benefits. But plantation companies are finding that changing worker attitudes and replacing their aging workforce is harder than investing millions on infrastructure and services.

Gopiratnam is from Talawakelle but works as a security guard at a plantation bungalow turned into a hotel in Haputale, the approach to which has breathtaking views of the southern plains.

He earns Rs. 20,000 a month but is not satisfied and instead wants to move to Colombo where he has found a job that pays Rs. 30,000.

He has no desire to work on tea plantations where his parents and grand-parents grew up and worked and is a good example of the new generation of youth in the workforce that produce the Ceylon tea that's now a world famous brand and has been a pillar of the economy for over a century. Gopi is not concerned that he has to travel six hours to work weekly from his hometown, taking two buses, if he takes up a job in Colombo. Nor has he thought that living costs in Colombo - especially food and lodging - would be much higher and would eat up much of his anticipated monthly earnings.

White-collar job

If he were to work on the estates his monthly wage would be lower than what he would get in Colombo but his living costs would also be much lower. And he would be in the village he grew up in. Instead, he is lured by the 'office-type' or 'white collar' jobs found in urban areas.

His views are typical of today's plantation community youth which has become a big dilemma for the regional plantations companies managing the estates which produce Sri Lanka's top export product.

The estate workforce is aging and the industry finds it hard to find replacements for retiring workers. The RPCs have repeatedly highlighted the facilities they provide workers and their families and that the income of estate workers does compare favourably with that of other agriculture sector workers.

Outgoing chairman of the Planter's Association of Ceylon, Roshan Rajadurai revealed how much regional plantation companies (RPCs) have invested in their workers when he addressed the association's 162nd annual general meeting recently.

Since privatization, from 1993 to 2015, the RPCs total Capital Expenditure was well over Rs. 55 billion which is far more than the total profits earned by the RPCs, he said. Rs. 7 billion was paid as dividends to Sri Lankan shareholders, Rs. 7 billion lease rental to the government and Rs. 1.5 billion income tax to the state. According to the State Ministry of Plantation Industries, up to the time of privatization in 1992, US$ 275 million, equal to Rs. 35 billion in current terms was the capital investments in the plantations through various donor and mostly grant funding.

He also said that RPC workers daily wage rate Rs. 620 per day is higher than the Rs. 590 rate the tea and rubber smallholders who constitute 77% of the Tea/Rubber Sector labour force get under the Statutory Tea and Rubber Wages Boards.

"Compared to the daily wage rate of our competing tea economies, the rate in North India is Indian Rs. 115 per day, (SL Rs. 241) for a base output of 26 kilos, South India is Indian Rs. 232 for 36 kilos (SL Rs. 487) and Kenya SL Rs. 443 for 48 kilos while in Sri Lanka is Rs. 620 for 16 to 18 kilos in RPCs. Tea Small Holders in Sri Lanka pluck around 26 to 30 kilos on a productivity based wage system."

Four-fold increase

Rajadurai said that during state management from 1980 to 1991, the daily wages of workers increased from Rs.11.63 to Rs.48.32, only a four-fold increase. Under RPCs from 1992, it increased from Rs.48.32 to Rs.620, a 13-fold increase.

Before privatization from 1980 to 1991, the average daily labour wage for the period was only 70% of the value of a High Grown kilo of Tea.

After privatization, from 1992 to 2015, it steeply increased to 116%. From 2011 onwards, the labour wage was more than 150% and by 2015 this ratio has increased up to160%. Even when the labour wage was only 70% of the value of a kilo of tea, the estates were making losses prior to privatization in 1992.

Survey

According to the last government Household Income and Expenditure Survey (HIES), the Estate Sector Wages and Salaries are 23% above the Rural Sector which is 77% of the population compared to the 5% in the estate sector, Rajadurai said.

RPCs have to pay for not only the salaries and wages of the people employed by them but dependents as well. For every one worker employed by them, there are six non-working dependent souls who are resident and living on the estates who draw on the facilities and resources of the estate.

"However, in the Rural Sector; Agricultural activities, other cash income, non-monetary income and rent value of own occupied housing add up to higher total Household income than the Estate sector," Rajadurai said.

"In the Estate sector, 40% of the households are above the total house hold income group Rs. 27,975 to Rs. 32,338 compared to only 50% of the rural sector according to HIES."

The own account workers and family workers who are engaged in the agriculture sector, Tea and Rubber Small Holders have no guarantee of regular year round employment, regular monthly wages and salary advances, statutory dues, terminal benefits and facilities that are compulsorily given to the RPC workers, Rajadurai said.

"In contrast, the RPC workers get fully secured, guaranteed life time family employment with the estates having to offer a mandatory minimum of 300 days of work per year on the estates from 18-60 years irrespective of the level of the worker productivity or the field productivity, even though climatic and weather conditions are not favourable or conducive for the guaranteed offer of work in this manner, in an agricultural enterprise so frequently subject to the vagaries of the weather."

The comparative earnings of plantation workers have increased substantially but, says Rajadurai, "the critical issue is in the house hold cash management in the plantation sector and the entitlement mind set and the dependent syndrome of estate sector workers."