Private sector not willing to pay Rs. 2,500 allowance

Private sector employers have called upon the government to reconsider the request made through the 2016 Budget to grant Rs. 2,500 to every private sector employee drawing a salary below Rs. 40,000, as a relief allowance.

Employers speaking at the ‘Meet the Minister ‘forum organized by the National Chamber of Commerce last week, said with over 75 percent of the employees drawing below Rs. 40,000 and companies having to incur several other expenses in addition to the payment of Employers’ Provident Fund (EPF) and Employees’ Trust Fund (ETF), and as such the payment of an allowance of Rs. 2,500 is not sustainable.

The EPF is a contributory social security scheme where the employees and employers contribute 8% and 12% respectively, of the monthly total earnings of the employee. The ETF law stipulates that employers of private and semi-government sector contribute 3% of the gross salary of their employees monthly to the Fund.

“The impact of this commitment to employers has been severe to the extent that we are unable to run our business which is currently going through a difficult phase due to various taxes imposed on the business community,” an employer said.

Minister of Labour W. D. J. Seneviratne who presided at the forum said he could not do much to relieve the burden on employers.

“This was an election promise by the government. What I was able to do was to grant a grace period to make the payment,” Minister Seneviratne said.

Employers called on the government to have wide consultations before taking decisions concerning the private sector. They said the government should not interfere in the affairs of the private sector which should be left to run its own affairs.

“Ad hoc legislation of this nature will not help the private sector which is the engine of growth. We have supported the economy trough thick and thin and assisted governments during tough times,” an employee said.

Employers’ Federation of Ceylon Director General Kanishka Weerasinghe said the national salaries commission should have a mechanism for minimum wages of employees.

- LF