During the nineteenth century, labor legislation dealt with the large plantations, and more general labor laws were passed only in the closing years of colonial rule. In 1941 the government enacted the Wages Boards Ordinance, the first comprehensive piece of legislation regarding the payment of wages, the regulation of working hours, and sick and annual leave; the ordinance also empowered the government to establish wages boards for any trade. The boards are composed of an equal number of representatives of workers and employers and three appointees proposed by the commissioner of labor.

Ordinances of 1942 and 1946 required all factories to be registered and established minimum standards for health and safety. The laws also gave the commissioner the right to send inspectors to the factories and to judge whether a plant was meeting minimum standards. The Shops and Offices Employees Act of 1954 extended the provisions of the factories legislation to small shops.

The Maternity Benefits Ordinance, as amended in 1957, entitled a woman who worked in a factory, mine, or estate to full compensation for a period of two weeks before her confinement and for six weeks afterward. The employee must have worked for the employer 150 days before her confinement to be eligible to receive the benefits.

The Employees Provident Fund, established in 1958, provided a national retirement program for the private sector. The Provident Fund required an employer to contribute 6 percent of total earnings and an employee to contribute 4 percent of earnings exclusive of overtime pay. Participation in this plan grew quickly, and in the 1980s most salaried workers in the formal sectors of the economy were members. Government employees had their own pension plans.

Although legislation protecting the health and welfare of workers was extensive, enforcement was inconsistent. The government departments charged with enforcement were chronically underfunded in the late 1980s. Moreover, many labor regulations were suspended in the investment promotion zones. Most labor legislation also did not apply to rice farming and other economic activities carried out informally.

Data as of October 1988

NOTE: The information regarding Sri Lanka on this page is re-published from The Library of Congress Country Studies and the CIA World Factbook. No claims are made regarding the accuracy of Sri Lanka Government Labor Policies information contained here. All suggestions for corrections of any errors about Sri Lanka Government Labor Policies should be addressed to the Library of Congress and the CIA.