Sri Lanka’s private sector employee minimum basic salary set at Rs. 21,000

Speaker Mahinda Yapa Abeywardena signed a Bill on September 11 that sets the minimum basic salary for Sri Lanka’s private sector employees at Rs. 21,000.

The Labour and Foreign Employment Ministry stated that this amount should be used as the minimum wage when calculating payments for the Employees’ Provident Fund (EPF), Employees’ Trust Fund (ETF), and gratuity.

According to the Bill, private sector employers must now pay a national minimum wage of Rs. 17,500, plus an additional Rs. 3,500, starting this month.

This salary increase aligns with the Budget Relief Acts No. 36 of 2005 and No. 4 of 2016, bringing the total minimum wage to Rs. 21,000.

The National Minimum Wage Act No. 03 of 2016, which took effect on January 1, 2016, initially set the minimum monthly wage at Rs. 10,000 and the daily wage at Rs. 400.

In August 2021, the minimum monthly wage was raised to Rs. 12,500, and the daily wage to Rs. 500.

Due to the recent economic crisis and the rising cost of living, private sector wages haven’t increased since 2021.

As a result, a draft amendment was submitted to Parliament to increase the National Minimum Wage from Rs. 12,500 to Rs. 17,500 and the daily minimum wage from Rs. 500 to Rs. 700.

This amendment was passed by Parliament on September 3, 2024, and is set to be implemented this month following the Speaker’s approval.