Income tax, social security and wages: Employee rights in Sri Lanka

 

Source: https://www.mctimothyassociates.com/product/understanding-labor-law-employee-relations-virtual-training/

“The Internal Revenue Code imposes or imposes or gives legal authority to impose income tax on the profits and income of all persons for each year of assessment accrued or accrued after April 1, 2006. (http://www.ird.gov.lk/it.html)

Taxpayer Identification Number (TIN)

Once you have earned income in Sri Lanka, you will need to register a TIN. Instructions and application forms for download are available from the Sri Lanka Inland Revenue website.

Foreigners who are considered non-residents of Sri Lanka are only subject to income tax on profits and income earned in Sri Lanka.

Social Security

According to the International Labor Organization (ILO), Sri Lanka offers its citizens a relatively high level of social protection, but there are worrisome gaps, such as the lack of unemployment protection, and social distancing in some areas. Little or no coverage. totally covered

However, the following scheme is being developed.

• Old age/disability/survival
• Industrial Accidents (Industrial Accident Ordinance)
• Illness and motherhood
• Family support (support for low-income households)
• Employee Provident Fund (EPF)
• Employee Trust Fund (ETF)

Minimum Wage

Sri Lanka does not have a fixed minimum wage for all persons employed in the country, but no Sri Lankan worker can pay less than the mandated minimum wage. This is determined by the occupation in which the employee works.(Goonetilleke,J & Cooray, D. 2020)

There are two main rules that govern the wages and salaries of employees in Sri Lanka.

• 1941 Wages Commission Ordinance
• Shops and Office Workers Act of 1954

Wages are also determined as follows:

• Colombo Cost of Living Index (CCLI).
• Cost of Living Assistance (COLA). All private and public sector workers are eligible for COLA benefits.
• Salaries also include employer contributions to the Employee Provident Fund (EPF) and Employee Provident Fund (ETF).

A Sri Lankan employee is paid daily, weekly, bi-weekly, or monthly even if the payment period exceeds one month.

Rights in Sri Lanka

minimum wage

working time

salary cycle

Payment date

overtime pay

leaves - 

                              Public holiday

                              Annual holiday

                              Casual leave

                              Maternity leave

                              Sick leave

                              Marriage registration certificate

                              adoption leave

                              Childcare leave

                              Death Leave

                              Accident at work

                              Duty leave

Taxes in Sri Lanka

The Government of Sri Lanka abolished the Pay As You Earn (PAYE) tax in November 2019. However, it was amended by Finance Law No. 24 of 2017 and introduced as Advanced Individual Income Tax (APIT). January 1, 2020.

The Inland Revenue Department (IRD) said in a circular that an employer can exempt her from APIT tax with the consent of an employee who earns more than Rs 250,000 per month or Rs 3 million.

If you want to know how to calculate and manage your APIT obligations, we have a complete guide to advanced personal income tax.(Jha, P. 2021)

________________________________________

As an employer, you are responsible for withholding and paying income tax from each employee's income and earnings when making payments. This guide will tell you everything you need to know about how to manage PAYE tax, including how to correctly apply the PAYE tax schedule set out in Finance Law No. 24 of 2017.

Source: https://www.dnaindia.com/business/column-why-inheritance-tax-needs-to-be-analysed-2767893

Employee Responsibilities in Sri Lanka

Employees are liable to their employers even if they work part-time or have no written contract with the employer.

The main duties of employees are:

• Hired to do work personally
• Work politely and seriously (If you are late, come late, or are absent without notice, you may be dismissed or disciplined.)
• Do not endanger yourself or others
• Follow the instructions of the employer (There are exceptions. For example, if the employer asks the employee to perform dangerous or illegal acts, the employee does not have to follow the instructions.
• Be loyal and honest

What is responsibility

Loyalty: You must keep your employer's interests in mind in everything you do and never do anything that would harm the company.

Honesty: We must be honest with our employers, colleagues, and customers.

Timetables and Deadlines: You must be on time for work and complete each task before the deadline.

Health and Safety: You must keep yourself and others safe.

Professionalism: Must be dedicated to quality work

Code of Conduct

Workplaces regulate how people should behave while at work, usually in a document called a 'code of conduct.'

Codes of conduct typically include the following clauses:

• Respect for diversity and identity
• Do not unfairly discriminate against anyone
• Appropriate clothing
• Most workplaces have dress guidelines.
• Use of social networks
• Companies are sensitive to public opinion. Employees can influence this perception by complaining about their work or by showing private photos on social media.
• Confidentiality

Some degree of confidentiality is important to most companies. If competitors find out what your business is doing, they could lose money.

Confidentiality clauses require employees not to discuss business plans or processes during or after a contract.

Foster positive working relationships

Employers can promote a positive work environment by:

• Promote equality, diversity, and inclusion.
• Provide opportunities for staff training and development.
• Create opportunities to network and share good practices.

Employee rights and responsibilities are important so that all employees, including their colleagues, are aware of what they should do to promote a safe and healthy work environment.

Dealing with Harassment and Discrimination

Unfortunately, workplace bullying is still quite a common issue and can make your working life unpleasant and upsetting. Worse still is if you’re being targeted due to a protected characteristic, which falls under workplace discrimination.

If you don't know your rights as an employee, you may not immediately realize when you've been teased, ignored, or set unrealistic goals, and don't know how to deal with it. It can also be more difficult to analyze whether co-workers or employers engage in discriminatory behavior, such as using discriminatory slang or hiring different genders for different roles. There is nature.

In either case, you should have legal protection on your side and be able to get help inside and outside the workplace.

Understand if your workplace is compliant

Knowing your workers' rights can also help you make sure you're working in a location that provides a safe working environment. Workplaces are expected to meet certain legal standards, such as providing an environment that is properly heated and equipped for use, and that workers receive adequate training before using machinery. It has been.

Seeing the expected salary for your role, getting the right training, and being provided with the right protective clothing can help ensure a safe workplace. Accept no less than this when it comes to the workplace.

Check if you have been unfairly dismissed

When you lose your job, it's tempting to forget everything and move on. But if this happens suddenly and you aren't prepared for it, this can be even more upsetting and painful. This means that your employment has been terminated due to your claim that you did not perform work that was not contracted.

Even before you start working, it's worth taking the time to review your rights if you're fired, as you may be entitled to a settlement or termination. This allows you to prepare for each situation in advance, just in case.

Understanding employee rights can be overwhelming and stressful. Also, employee rights are manipulated in so many ways that it can be difficult to recognize when this is happening. Deciding to learn more about your rights as an employee is the most powerful action you can take and may one day allow you to handle difficult situations more easily.

Meta: Understanding employee rights and why they matter can make difficult workplace situations a little easier. For more information, read our blog.

Conclusion

Employees have certain rights at work. Workplace rights and responsibilities help employees feel safe and secure during working hours. However, with these rights come important responsibilities. Employees are expected to meet commitments explicitly designed to maintain productivity and civility in the workplace.

If these responsibilities are not met, strict action will be taken against them and they will be confronted directly by senior management and asked to leave the organization immediately, usually after a few warnings. Abusive employees are kicked out of the company to maintain a culture of office work for the welfare of other employees.

Reference

Azmi, W. (2022) Employers & Employee Rights and responsibilities at workplace 19 employers & Employee rights and responsibilities 2023 (online). Available at <https://www.startuphrtoolkit.com/employee-rights-and-responsibilities/ >. [Accessed on 10^th April 2023]

Jha, P. (2021) The Sri Lanka Guide: Employment Laws, Taxes and Benefits (online). Available at < https://www.skuad.io/blog/the-sri-lanka-guide-employment-laws-taxes-and-benefits >. [Accessed on 13^th April 2023]

Goonetilleke, J. Cooray, D. (2020) Employment and Employee Benefits in Sri Lanka: Overview (online). Available at < https://uk.practicallaw.thomsonreuters.com >. [Accessed on 13^th April 2023]