Observation (CEACR) - adopted 2010, published 100th ILC session (2011)

Right to Organise and Collective Bargaining Convention, 1949 (No. 98) - Sri Lanka (Ratification: 1972)

The Committee notes the comments submitted by the Ceylon Bank Employees’ Union (CBEU) dated 16 February 2009 as well as by the Lanka Jathika Estate Workers’ Union (LJEWU) dated 2 August 2010 and by the International Trade Union Confederation (ITUC) in a communication dated
24 August 2010.

The Committee notes that the Government indicates in its report that a project entitled “Promotion of Principles and Fundamental Rights at Work” is being implemented by the Ministry of Labour Relations and Productivity Promotion in collaboration with the ILO and that a Special National Labour Advisory Council Meeting would take place in this framework in September 2010, in order to reach consensus among the social partners to effectively address the deficits in the implementation of ILO Convention No. 98, the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87), and the Workers’ Representatives Convention, 1971 (No. 135).

Article 1 of the Convention. Protection against acts of anti-union discrimination. In its previous observation, the Committee noted that under section 43(1A) of the 1999 Industrial Disputes (Amendment) Act, any contravention of the provisions concerning anti-union discrimination shall be punished by a fine not exceeding 20,000 rupees (approximately US$175) and requested the Government to provide information on the dissuasive character of this provision, in particular as regards the relationship of the amount of the fine with the average wage. The Committee noted the Government’s indication that there was no relationship between the amount of the fine and the average wage, that a proposal had been initiated to revise and update penalties, surcharges and stamp duties under existing labour legislation and that this matter had been referred to the National Labour Advisory Council (NLAC) in order to obtain the views of the social partners. The Committee notes that the Government indicates in its report that, on the recommendations of the Labour Law Reform Committee, it has decided to increase the fine up to 100,000 rupees and that a Bill was drafted in this sense, which will be presented to the Parliament in the next few months. The Committee recalls that Article 1 of the Convention guarantees workers adequate protection against acts of anti-union discrimination and that legislation prohibiting acts of discrimination is inadequate if it is not coupled with effective, expeditious procedures and sufficiently dissuasive sanctions to ensure their application (see General Survey of 1994 on freedom of association and collective bargaining, paragraphs 223 and 224). The Committee requests the Government to take the necessary measures to ensure that the views of the social partners are fully taken into consideration in the drafting process of updating penalties, to indicate any progress made in this respect in its next report, and to provide a copy of the Bill once adopted.

Furthermore, the Committee had previously noted allegations according to which adequate protection against anti-union discrimination was not provided in practice, as only the Department of Labour could bring cases before the Magistrate’s Court and that there were no mandatory time limits within which complaints should be made to the Court. The Committee had requested the Government to take measures in consultation with the social partners to guarantee a more expeditious and adequate procedure which, in particular, would establish short time periods for the examination of the cases by the authorities, and to indicate whether trade unions had the capacity to bring their grievances concerning anti-union discrimination directly before the courts. The Committee notes that the Government indicates in its report that: (i) the courts always try to conclude cases as expeditiously as possible while accommodating the concerns of all parties and the principles of law; (ii) the opportunity of granting trade unions the right to bring anti-union discrimination claims directly before the courts will be closely examined, taking into account the difficulties which may arise in relation to the collection of the requested evidences by the unions; (iii) concern should also be given to the possibility for employers to bring claims before the courts in cases of unfair labour practices by the trade unions; and that (iv) the Government wishes to further negotiate the issue with the social partners in the framework of the Special National Labour Advisory Council Meeting of September 2010 and inquire from the Attorney General the feasibility of granting such rights. The Committee requests the Government to take the necessary measures, in consultation with the social partners, to guarantee a more expeditious and adequate procedure which would, in particular, establish short time periods for the examination of cases by the judicial authorities, and to provide information in this regard in its next report.

Finally, the Committee notes the communication submitted by the Government dated 26 January 2009 in response to the petition submitted by the CBEU dated 17 October 2008 concerning alleged acts of discrimination against trade union members, in particular retrenchment measures adopted by the employer which lead to the termination of employment of 97 employees members of the CBEU, in violation of a collective agreement in force. The Committee notes the comments submitted by the employer involved. The Committee also notes that the Government indicates in its report that the conflict arose as a result of a merger of two financial institutions and that the Court of Appeal, in this case, rejected the requests of the CBEU.

Article 4. Measures to promote collective bargaining. In its previous observation, the Committee requested the Government to indicate the measures taken by the Social Dialogue and Workplace Cooperation Unit (SDWC) as well as the measures taken under the auspices of the National Policy for Decent Work, to promote collective bargaining. The Committee noted that 29 Provincial Labour Advisory Councils (PLACs) were established in order to promote collective bargaining and tripartite consultations in a decentralized manner, and that their activities were coordinated by the SDWC Unit. The Committee notes that the Government indicates that the most representative trade unions’ and employers’ organizations are consulted by the PLACs on labour matters and that it provides, with its report, a list of collective agreements concluded between 2008 and 2010. The Committee requests the Government to keep it informed of any progress achieved by the measures taken by the Social Dialogue and Workplace Cooperation Unit and those taken in furtherance of the National Policy for Decent Work to promote collective bargaining.

Export processing zones (EPZs). In its previous observation, as regards the need to promote collective bargaining within the EPZ sector, the Committee noted the information provided by the Government according to which 40 per cent of EPZ enterprises have employees’ councils that have bargaining rights, and that some of them were in the process of concluding collective agreements. The Committee also noted that, according to the ITUC, employees’ councils were bodies funded by the employer without workers’ contributions – thus giving them an advantage over trade unions which require membership dues – and that employees’ councils were promoted by the Board of Investment (BOI) as a substitute for trade unions in EPZs. The Committee notes that the Government indicates in its report that around ten trade unions operate in EPZs and provides statistical information showing that out of 260 enterprises operating in EPZs, 25 enterprises negotiate with trade unions, 13 enterprises have granted “check‑off” facility to trade unions and five have signed collective agreements. The Government’s report adds that neither the Ministry of Labour, nor the BOI, promote the establishment of employees’ councils or trade unions, that the BOI’s role in establishing employees’ councils is strictly restricted to that of a facilitator, and that registered employees’ councils are entitled to bargain collectively and conclude agreements on behalf of workers where there is no trade union with bargaining status. Finally, it adds that the “Promotion of Principles and Fundamental Rights at Work” project (referred to above) has a special focus on EPZs. Given the low number of collective agreements in EPZs indicated by the Government, the Committee requests it to provide information in its next report on measures taken to promote collective bargaining in the EPZ sector, as well as information concerning complaints made by trade unions against non‑independent employees’ councils.

Provisions on trade union recognition. In its previous observation, the Committee had requested the Government to indicate the measures taken so as to ensure that the recognition provisions for collective bargaining purposes were effectively implemented in practice. The Committee had requested the Government in particular to comment upon the allegations made by the ITUC – reiterated this year – that the recognition of unions for collective bargaining purposes is hampered by excessive delays, and that employers tend to delay the holding of union certification polls to identify, victimize and on occasion dismiss the union activists concerned and that as a result, workers are afraid of being identified with the union, and the union loses the poll. The Committee notes that the ITUC indicates that the unions should be able to hold their elections within four weeks of sending their application for recognition. The Committee further notes that the Government indicates in its report, that a Circular adopted on 19 September 2000 sets the guidelines for the conduct of the referendum, referred to in section 32A of the Industrial Dispute Act, in order to ascertain whether a trade union possesses at least 40 per cent of the workers on whose behalf it seeks to bargain. Section 1 of the Circular provides that the relevant officer should hold a referendum (poll) within 30 days of the trade union’s request. The Government’s report adds that experience has shown that in the majority of the cases these time limits have been adhered to by the labour officers.

Representativeness requirements for collective bargaining. In its previous observation, the Committee had noted that, under section 32A(g) of the 1999 Industrial Disputes (Amendment) Act, no employer shall refuse to bargain with a trade union which has in its membership not less than 40 per cent of the workmen on whose behalf the trade union seeks to bargain. It subsequently requested the Government to ensure that if no trade union covers more than 40 per cent of the workers, collective bargaining rights should be granted to all the unions in this unit, at least on behalf of their own members, and to indicate the measures taken in this regard. The Committee noted the Government’s indication that this matter was placed before the Labour Law Reform Committee appointed by the NLAC and that the Ministry, for its part, was of the view that reducing the percentage requirement might lead to inter-union rivalry. The Committee notes that the Government indicates in its report that the issue has been taken up several times in 2010, including before the NLAC and the Labour Law Reform Committee, but that in both these forums there were no consensus amongst the trade unions themselves. The Government’s report adds that the majority of trade unions therefore collectively agreed to retain the present threshold and viewed that trade unions with different views would weaken the collective bargaining power of the unions. The Committee also notes that the ITUC indicates that certain employers change their staffing figures to ensure that the 40 per cent representation target is hard to meet, for instance by including middle and top managers in the calculation of the total staff. The Committee recalls that if no union covers more than 40 per cent of the workers’ collective bargaining rights should be granted to all the unions in the unit, at least on behalf of their own members. The Committee therefore requests the Government to pursue its efforts in this respect, to take the necessary measures to give effect to this principle, and to indicate the progress made in this regard in its next report.

Article 6. Denial of the right to collective bargaining in the public service. In its previous observation, the Committee considered, on the basis of the information provided by the Government, that the procedures regarding the right to collective bargaining of public sector workers do not provide for genuine collective bargaining, but rather establish a consultative mechanism – with perhaps some elements of arbitration – under which the demands of public service trade unions are considered, while the final decision on salary determination rests with the Cabinet of Ministers. The Committee notes that the Government recalls in its report that while a National Salaries and Cadre Commission was appointed in 2005 to restructure and determine salaries of public officers at all levels, it is difficult for the public administration to have different wage systems and terms and conditions for each profession, occupation and service. The Government’s report adds that there is however no obstacle for trade unions in the public services to bargain with authorities on issues specific to certain professions, occupations and services. The Committee once again recalls that all public servants, with the sole possible exception of those engaged in the administration of the State, should enjoy the right to collective bargaining with respect to salaries and other conditions of employment (see General Survey, op. cit., paragraph 262). Noting that, as at 31 December 2008, there were 1,933 registered trade unions out of which 1,130 were public officers’ unions representing 1.2 million public employees, the Committee once again requests the Government to take the necessary measures to ensure and promote civil servants’ right to collective bargaining in accordance with this principle, and to indicate any developments in this regard in its next report.

Furthermore, the Committee notes that a draft report on the ILO Project for the Prevention and Solution of Disputes in the Public Sector is attached to the Government’s report. The draft report provides, in particular, that efforts should be made to improve industrial relations in the public sector, which should be based on the improvement of social dialogue mechanisms at different levels of decision-making and on the creation of a sound system for collective dispute settlement. More specifically, the draft report indicates that the setting up of a National Arbitration Board is high in the agenda of both trade unions and Ministry officials, and that it is conceived rather as a mechanism to regulate industrial relations, than as a last resort to settle disputes. As regards conflicts in the public sector, the Committee recalls that compulsory arbitration may only occur at the request of both parties to the dispute (i.e. voluntary arbitration), or if the conflict relates to essential services in the strict sense of the term, or if the conflict involves public servants engaged in the administration of the State. The Committee requests the Government to take the necessary measures to ensure that the abovementioned principle is taken into account in the discussions on the mechanism for collective dispute settlement, and to provide a copy of the report once adopted.