Labour Law

The Factories Ordinance applies to any establishment engaged in:

  • A manufacturing process
  • Charitable or reformatory work
  • Technical or vocational training, where any manual labour is exercised such as making, altering, and repairing, ornamenting, finishing, washing, cleaning , or adapting for sale.
  • Even if these premises do not constitute a factory, the provisions of the Factories Ordinance will apply.

The Shop and Office Employees Act is applicable to all employees working in a shop or an office.

The Wages Board Ordinance will apply to all trades listed under the Ordinance and under the Wages Board Ordinance

  • A normal working week cannot exceed 48 hours
  • All work over and beyond that period is considered overtime.
  • A maximum of 12 hours of overtime per week is permitted.
  • According to Section 24 (d) the payment for work on holidays should not be less than the overtime rate
  • If no overtime rate has been determined, then payment must be calculated at one-and-a quarter times the rate normally applicable to such work
  • A holiday must be given with or without remuneration on a day within a specified number of days
Annual Leave and Holidays
An employee is entitled to take annual leave when the next calendar year starts. The duration of that first annual leave period is determined according to the date/month on which the employment commenced. From the second year onward, an employee is entitled to 14 days of paid annual leave, after completion of 12 months of continuous service. For the first year, an employee would have following annual leave, depending upon the time
of commencement of his employment:
  • 14 days if the employment commences on or after the first day of January but before the first day of April
  • 10 days if the employment commences on or after the first day of April but before the first day of July
  • 7 days if the employment commences on or after the first day of July but before the first day of October: and
  • 4 days if the employment commences on or after the first day of October.
  • A worker is required to take his annual leave within twelve months of its entitlement. Annual leave schedule is determined by the mutual agreement between the employer and the employee
  • Under Wages Board Ordinance, a higher level of annual leave (up to 21 days) is provided for some trades by the Wage Boards.
Sick Leave - Income
In accordance with the Shop and Office Act, every worker certified by a medical practitioner is entitled to a paid sick leave (sickness benefit) for a period of 07 days (in a 12 month period) for private business, ill-health or any other reasonable cause. These are generally known as casual leave. Casual leave is normally availed from one-half day to one or more days at a time. This does not include a case of prolonged ill health.

Pay on Public Holidays
Workers are entitled to paid Festival (public and religious) holidays. Festival holidays are announced by Sri Lankan Government at the start of calendar year (usually 16 in number).

Maternity and Work
The duration of maternity leave is 12 weeks (84 days) excluding weekly holidays, Poya days and statutory holidays. Out of these 12 weeks, 02 weeks maternity leave is before confinement (including the day of her confinement) and 10 weeks following the day of confinement.

For the third and subsequent confinement, duration of maternity leave is 42 days excluding wee kly holidays, Poya days and statutory holidays. Under the Maternity Benefits Ordinance, 6 weeks, inclusive of all non-working days, maternity leave is allowed. Overtime Compensation
In accordance with the Shop and Office Employees Act, normal working hours are 8 hours per day and 45 hours per week. The Factories Ordinance states that the normal working hours must not exceed 09 hours per day, exclusive of intervals allowed for meals and rest.

Compensatory Holidays / Rest Days
No provision could be identified in laws to require an employer to provide compensatory rest day to those workers working on weekly rest day. However, if a worker works on a public holiday, he/she has to be allowed a holiday with full pay on or before the 31st of December.

Weekend / Public Holiday Work Compensation
Employees may be required to work on weekend and public holidays. If workers have to work on a public holiday, they are entitled to 200% of the normal rate of wages. No premium is provided for working on weekly rest days.