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Have a baby in Sri Lanka and lose your job

Overworked, underpaid, casual-contracted, yet unorganised women are the backbone of Sri Lanka's garment industry – a sector that is vital to the country's economy.

Kamala Sundari, 25, is pregnant and wonders what she'll do once the baby arrives. She was hired a year ago as a casual worker in a garment washing plant. Although she works hard, she knows that once she walks out the door to deliver the baby, she will lose her job.

"The pay is not very good but it is still a job," Sundari says. She and her husband earn just enough to stay out of debt. "If I lose this job after the baby, I don't know how we will manage."

Sundari is not aware that her boss is breaking the law by employing her as a casual worker. And there's no workers union at the washing plant to tell her that.

Sundari's experience is not unusual for women in Sri Lanka, despite its strong history in trade unionism. Sectors such as the garment industry which employ most women are also the ones that side-step labour laws – and earn most of Sri Lanka's foreign-exchange.

The garment industry earns about $3 billion a year – in 2001 it accounted for half of Sri Lanka's foreign exchange earnings – and 90 per cent of its employees are women. But there is hardly any organised voice to lobby for rights and benefits or protest against unfair treatment.

Now the government, the domestic private sector, foreign investors and donors, are joining hands to try and push through legislative changes that would create a more 'flexible' labour market so workers can be more easily hired and fired.

Women, already in a weakened position, are likely to suffer the most.

The ideas are encapsulated in the country's strategy to reduce poverty – chiefly by stimulating economic growth. The Poverty Reduction Strategy Paper (PRSP), written by the government in consultation with civil society, has to be approved by the International Monetary Fund and World Bank for poor countries to qualify for aid and debt relief. Over 45 other developing countries are going through such a process, and many of them are incorporating similar recommendations.

Sri Lanka's strategy paper argues that without such changes it will be difficult to attract foreign investors, make business more competitive and create the two million jobs a year needed to absorb the labour surplus.

By 2001 the IMF had already made labour law reforms a condition for financial assistance. Despite Sri Lanka's 20-year record of steady economic growth – an average of 2.9 per cent a year – and strong progress in health, literacy and life expectancy, a 20-year civil war has left it in financial straits, forcing subsequent governments to agree to donor demands.

Existing labour laws are commonly believed to favour workers, allowing the Commissioner of Labour, a bureaucrat, to dictate terms and issue decrees to any employer on any labour dispute.

Changes are sought in the TEWA (Termination of Employment of Workmen Act) and IDA (Industrial Disputes Act) – primarily to facilitate a hire-and-fire policy and speedy resolution to labour disputes, known to cripple services and drive companies over the brink.

Many of the amendments are still in a draft stage and hotly disputed by trade unions. The main opposition party, the Marxist People's Liberation Front (JVP), is also vehemently opposing them in the run-up to general elections on 2 April.

Some changes, however, were passed in December 2003 – to cut redundancy payment and extend women's overtime limit from 100 to 720 hours a year, allowing factories to impose longer working hours on female staff.

But the private sector wants more. "We still need the consent of the worker to implement overtime. To be competitive, we need at least a couple of hours a day compulsory overtime. This is crucial," said Ravi Pieris, vice president of the Employers' Federation of Sri Lanka.

"The changes to the Termination Act are not sufficient. We need to be more flexible and not need to liaise with the Commissioner of Labour for every small decision."

Industrialists say these changes are the best way to increase productivity and competitiveness, predicting that increasing rivalry from Bangladesh, China and Vietnam will result in the closure of half Sri Lanka's 800 garment factories by the end of 2005.

Opponents fear the amendments will lead to a sharp rise in joblessness, with little expectation of unemployment benefits, until the promised new jobs actually appear.

Women, who make up a third of the workforce, will fare worse than men. For one, female unemployment is already higher – 11.5 per cent compared to 6 per cent among males. With more women seeking work, businesses find it easier to fire and hire new female labour, especially the semi- and non-skilled workers who are common in the garment industry.

In addition most of the women employed in garment factories are in their early twenties and unmarried: employers exploit their youth, inexperience and women's general low status in society to impose unfair strictures.

This is a problem across Asia. Fewer than half the women in Bangladesh's garment factories have a contract and most receive no maternity or health coverage. In China, young women face 150 hours of overtime each month.

Underlying all this is lack of union representation. "Women are less inclined to form trade unions and participate in their work, perhaps because their spouses or parents object to such activity," says Nimal Pathirana of the Ceylon Mercantile Industrial General Workers Union.

In Sri Lanka's Free Trade Zones, where many of the garment factories are located, entrance is restricted to those who have passes. "So there can be little influence from larger trade unions and also little inspection from labour department officials," says Pathirana.

Against this background, labour reforms are likely to create even more uncertainty for women workers, despite their enormous contribution to the economy. "Female factory workers are generally unaware of their rights and do not speak up. They may even be cheated out of the correct compensation package," says Pathirana.

Some experts question just how effective the reforms will be in reducing poverty in the long run. According to Prof. Swarna Jayaweera of the Centre for Women's Research, "previous donor-insisted reforms have not resulted in sustained economic growth in Sri Lanka". They have also ignored the impact of reforms on women.

Coen Kompier, New Delhi-based specialist in South Asian labour standards at the International Labour Organisation, says there are other – better – ways to improve productivity: such as training staff, encouraging dialogue between workers and employers so that disputes are resolved quickly and improving safety in the workplace.

And rather than compete with Bangladesh, China and Vietnam in making cheap clothes, he says Sri Lanka may consider producing higher quality clothes.

As for the prospects of reforms, Kompier says: "We have to wait for the election results. If the present government is not re-elected, we will have a far less business-minded government" which will be less inclined to weaken the labour laws.

Tharuka Dissanaike is a Sri Lankan journalist and former features editor of the Sunday Observer.

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03/04/2004

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