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How to pay more than Rs. 1,000 per day to tea estate workers

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by Remy Jayasekere, Chartered Engineer

In the recent past there have been several articles written opposing the government decision to increase the wages of tea estate workers. On November 21, the Island newspaper published an article titled “Tea industry experts willing to learn the magic formula …” written by a spokesman for the Planters’ Association. Its theme was that under the present conditions it is not possible to increase wages.

There is a 1,000 acre tea plantation called Nerada in far north Queensland in Australia (neradatea.com.au). It produces 6.6 million kg of leaf and 1.6 million kg of made tea annually. Total labour force is less than 50 and the factory is manned by four people in a shift. The minimum hourly wage in Australia is about AUD 20 or around SLR 2,500 which works out to SLR 20,000 for an eight-hour day. Nerada pays above minimum wages so that they can retain talent.

Leaf plucking is done by one machine for the whole plantation – therefore there is only one tea plucker at any time and plucking is a 24-hour operation. The plantation is family-owned and they have developed all the technology themselves – no Tea Research Institutes or Tea Boards.

If Nerada can pay SLR 20,000 per person per day why can’t Sri Lanka pay SLR 1,000 per day? The answer is simple – at Nerada 50 people produce 1.6 million kg of made tea annually which works out to 32,000 kg per person annually. This is worth about AUD 150,000. Pay the worker AUD 50,000 per year and the company has AUD 100,000 per person per year for other things.

This has been achieved through innovation which has resulted in mechanisation and automation of processes. SL has not innovated, continuing to do things the way they have been done for ages. This could be the net result of many decisions taken in the past such as nationalisation of the plantations, regional plantation companies (RPC) not owning the plantations, therefore milking them rather than developing them and general backwardness of the country in developing and employing modern technology.

RPCs have managed the plantations for more than 25 years and if they are interested in developing the plantations, they had ample time to do so. However, they have chosen to remain in the dark ages without any innovative thinking and actions and now are arguing against wage increases. SLR 1,000 is around USD six per day which is not much higher than the extreme poverty level defined by the UN. The actions of the government, the plantation companies and the planters have made sure the workers remained in poverty during the past and now want to ensure that continues into the future.

In the 1980s Singapore had the problem of being turned into a large garment manufacturing centre which they did not want. The government increased the wages of garment factory workers – the message was innovate and produce more per worker or close down. History shows they all closed down and engaged in other pursuits. The Sri Lankan government should be congratulated for taking this bold step of increasing wages – the message is clear, innovate or we will change the agreements. How can you let the RPCs hold a large proportion of the population as well as the economy of the country hostage.

What is stopping us from using a company such as Nerada as the benchmark and trying to achieve what they have achieved. Let me list a few steps.

1. Green leaf – Nerada produces 6600 kg per acre per year. Considering it is one plantation, as a country can we aim for at least half of that. I am sure everyone knows what to do – the list is long. Definition of innovation – 5% is knowing what to do and 95% is doing it.

2. Plucking – This possibly is the highest cost item in the production of tea in Sri Lanka. Two excuses are given for not mechanising plucking – the terrain does not allow for mechanised plucking and mechanised plucking reduces the yield. New replanting areas should have the terrain modified to enable mechanised plucking. The myth of reduced yield does not stand against evidence from Nerada

3. Factory – There are more than 700 tea factories in Sri Lanka employing large numbers of people. Factories in some areas cannot find enough people to man them. Most of these people are used for transporting material from one process or machine to another and in some cases to watch and operate machines. At Nerada all these operations are automated and only four people are required in a shift. Why not scrap the existing factories and build new ones – the payback will be very quick. One of the big problems in the past was trying to modify existing factories which limits possibilities. Do not think outside the box. Think there is no box.

4. Then there are other minor things that go beyond what Nerada has done – using solar energy for the driers and using dehumidified air for withering. Nerada has no need for producing dehumidified air as the humidity in that area is very low.

5. The workers cannot do anything about these. The government, RPCs and management have to take the initiative to improve our plantations. There are no bad soldiers – only bad officers

I believe I have made a case for increasing wages of plantation workers and hope the RPCs will look at this in a positive manner.



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Hemas Consumer strengthens portfolio with L’Oréal partnership in Sri Lanka

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Hemas Consumer, the leading manufacturer and distributor in Sri Lanka’s beauty and personal care sector has strengthened its portfolio of offerings in a groundbreaking partnership with the world’s number one beauty company, L’Oréal. With this partnership Hemas Consumer obtains distributor rights to leverage its sales network and innovative marketing approaches in taking L’Oréal’s wide range of beauty and personal care brands across Sri Lanka.

Commenting on the new partnership, Sriyan de Silva Wijeyeratne, Managing Director, Hemas Consumer & Executive Director Hemas Group said, “We have spent over fifty years building successful and strong consumer brands in Sri Lanka. In keeping with our promise of consumer delight and trust, we are elated to partner a world-class cosmetics group like L’Oréal expanding our existing portfolio with the world’s most sought-after beauty and personal care products.

We are well equipped in our distribution process with island-wide sales channels to serve all parts of the country. I believe this partnership will revolutionize Sri Lanka’s beauty care industry and more prospects await as we continue to look ahead with L’Oréal.”

Sabrina Esufally, Director Business Development and Innovation at Hemas Consumer said, “This partnership will enable Sri Lankans to access the iconic brands and solutions created through years of research and innovation by L’Oréal. In the fast evolving and dynamic beauty industry, the combined strength of Hemas’s local heritage and penetration, and L’Oréal’s global technology and trust is the perfect recipe for consumer delight.”

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DFCC Bank supports industrial excellence by partnering CNCI Achiever Awards

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DFCC Bank PLC, stepped up once again for the 3rd consecutive year to partner with the Ceylon National Chamber of Industries (CNCI) as the principal sponsor and official banking partner of the CNCI Achiever Awards 2020.

The CNCI Achiever Awards was held for the 19th consecutive time to recognize the outstanding efforts of exceptional performers who have molded their respective industries with innovative solutions, while overcoming challenges and meeting the demands of their clientele. This year, the event was recently held under strict health guidelines at the Galadari Hotel in Colombo. 

Commenting on the sponsorship, Chief Executive Officer of DFCC Bank PLC Lakshman Silva stated, “We are pleased to have partnered with the Ceylon National Chamber of Industries (CNCI), as the Main Sponsor and Official Banking Partner of the 19th CNCI Achiever Awards 2020. DFCC is honored to partner in reconciling successful Sri Lankan businesses from various industrial sectors. Our partnership with this prestigious awards programme aligns seamlessly with our commitment to foster and reward industrial growth across the country and support local entrepreneurs in MSME & SME sectors.”

 

 

 

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Lanka SSL triumphs with National Gold and Top Ten Awards

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CNCI Achiever Awards 2020

Lanka Special Steel Limited (Lanka SSL), a trusted name in wires and a fully-owned subsidiary of E B Creasy & Company PLC, was recently awarded the coveted National Gold Award under the Extra Large category in the Manufacturing Sector at the Achiever Awards 2020 for Industrial Excellence.

The annual event organized by the Ceylon National Chamber of Industries (CNCI) was held in March 2021 at Colombo, and celebrated some of the leading industrialists in the country for their tremendous and continued efforts in uplifting and promoting quality standards, productivity, growth and strategy, R&D, employee welfare and others whilst contributing to both the society and economy at large.

‘We are immensely proud to have been recognized with two very prominent awards at this year’s CNCI Achiever Awards. It is a huge leap from just winning a Merit Award the last time around, and this incredible achievement certainly reflects our highly ambitious plans to strive for continued excellence. We would like to thank our valued customers and all stakeholders. We are grateful to our hardworking and committed staff at Lanka SSL who have made this possible,’ said Pravin De Silva, CEO of Lanka SSL.

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