Navigating employment regulations is crucial for businesses operating in Sri Lanka. The country's labor laws, primarily governed by the Shop and Office Employees (Regulation of Employment and Remuneration) Act and the Factories Ordinance, set clear standards for working hours, overtime, rest periods, and other conditions of employment. Understanding and adhering to these regulations is essential for compliance and fostering a fair working environment for employees.
These regulations aim to protect employees from excessive working hours and ensure they receive fair compensation for work performed beyond the standard limits. Employers must implement policies and practices that align with these legal requirements to avoid potential penalties and maintain good industrial relations.
Standard Working Hours and Workweek
Sri Lanka's labor laws define standard working hours for employees. For those covered under the Shop and Office Employees Act, the standard workweek is typically 45 hours, spread over five and a half days. The Factories Ordinance sets a standard workweek of 48 hours, usually over six days.
Specific daily limits also apply. For instance, under the Shop and Office Employees Act, daily working hours should not exceed 9 hours, including a meal interval. Under the Factories Ordinance, daily hours are generally limited to 9 hours.
Overtime Regulations and Compensation
Work performed beyond the standard daily or weekly hours is considered overtime and is subject to specific regulations regarding maximum limits and compensation rates.
The maximum amount of overtime an employee can work is generally limited. Under the Shop and Office Employees Act, overtime is typically limited to 12 hours per week. Under the Factories Ordinance, the limit is often 72 hours per month.
Overtime work must be compensated at a rate higher than the ordinary hourly rate. The standard overtime rate is one and a half times (1.5x) the employee's normal hourly wage.
| Work Type | Standard Rate | Overtime Rate |
|---|---|---|
| Ordinary Hours | 1x | - |
| Overtime Hours | - | 1.5x |
Rest Periods and Breaks
Employees are entitled to mandatory rest periods during their workday and a weekly rest day. For employees covered by the Shop and Office Employees Act, a break of at least one hour must be provided for meals and rest if the workday exceeds five hours.
A compulsory weekly holiday is also mandated. Under the Shop and Office Employees Act, this is typically one and a half consecutive days, usually Sunday and a half-day on Saturday. Under the Factories Ordinance, a full day's rest is required each week, usually Sunday.
Night Shift and Weekend Work Regulations
Specific rules may apply to employees working night shifts or on weekends, particularly regarding rest periods and compensation. While the standard weekly holiday is usually Sunday, work performed on this day or other designated holidays may attract higher compensation rates, often double (2x) the normal rate, in addition to a substitute rest day. Regulations may also stipulate conditions for night work, such as limitations on hours or requirements for adequate rest before and after the shift.
Working Time Recording Obligations
Employers in Sri Lanka are legally required to maintain accurate records of the working hours of their employees. This includes recording daily start and end times, break periods, and all overtime hours worked. These records are crucial for demonstrating compliance with labor laws regarding maximum working hours, overtime limits, and proper compensation. Records must be kept up-to-date and be available for inspection by labor authorities. Failure to maintain proper records can result in penalties.
