Transforming "Manpower Employment" to Decent Work of Greater Quality


Priyanka Jayawardena

by Priyanka Jayawardena

"I can’t build a house. I can’t afford to go for a family wedding. We are cornered by the society." -- Manpower worker attached to a State Bank

This is how a manpower worker was voicing the uncertainty of his future. These workers and their families lack stability and security to make long-term decisions and plan their lives due to the uncertain nature of their jobs and low wages. The discrepancies faced by manpower workers are evident by protests carried out by them in Sri Lanka. With the aim of exploring ways to transform manpower employment to decent work of greater quality, this article explores some hidden information in the manpower business, based on a recent IPS study titled "Why People Choose to Participate in Non-Standard Employment in Sri Lanka".

Who are Manpower Workers?

Workers who are not directly hired by the organization they work for, but are hired by third party agents or sub-contractors are referred to as manpower workers. Usually it is a disguised or ambiguous employment relationship. They lack access to social protection, receive low wages, and have substantial obstacles in joining a trade union or bargaining collectively. It is a part of a global business strategy practiced by employers, to shift risks and responsibilities onto workers. Manpower workers are not given a contract letter either by the company they work for, or the manpower agency. It is a precarious work arrangement, and raises serious concernas it is often unclear who is responsible and accountable for the rights and benefits of these workers. Due to the ambiguous nature of manpower employee contracts, there is limited data available on the matter.

Recruiting Employees through Manpower Agencies

For around 10-15 years, it has been common practice in the private sector to use manpower agencies to recruit employees to fill low-skilled, temporary and supplementary jobs (janitors, security guards,etc.). This has now gradually moved into main business activities of the company-- machine operators, cashiers,and sometimes even managerial levels.

Agency or sub-contractors enter into agreements with companies where they supply labour, but the terms and conditions of these agreements are not disclosed to the manpower workers.

"I didn’t have to sign a written contract when I was recruited. All I had to do was submit an application form before starting work".

Female manpower worker, Biyagama FTZ

Some manpower employees work continuously at a particular factory while some are hired on a daily basis. These daily hired workers are transferred from company to company, depending on the available vacancies. This is entirely handled by the manpower agency.

The agency hired employees receive their wages through the manpower agency after their commission is deducted, and are not given salary slips. Companies prefer hiring manpower workers as it is convenient for themas there are no direct obligations towards these workers. Most of the manpower workersare either from rural areas, less educated, or are school dropouts who have limited job opportunities. Therefore, in most cases, these manpower workers do not pay attention to their rights as they are helpless and have no other means of employment.

Female manpower worker, Biyagama FTZ

Most agencyhired workers in the private sector, are not given paid leave. They are allowed to take leave at any point, but will have to forego that day’s salary. Thus, most such workers are compelled to report to work even whenthey are sick, as they cannot afford to stay at home. Some in the private sector work long hours to earn more.

"I get paid on monthly basis, a daily wage of Rs. 600 per shift. My normal shift lasts 8 hours per day. But I have the option of working another full shift (8 hours) and obtaining Rs. 1200, but this would mean that I have to work 16 hours at a stretch."

Female manpower worker, Biyagama FTZ

These manpower workers are in a vulnerable situation; they do not receive private sector social security benefits such as EPF, which even temporary workers are entitled to. It is revealed that although deductions are made for EPF and ETF, there is no transparency and most workers are unaware whether they are even registered for EPF. They are afraid to voice their opinion as it would jeopardize their employment. Any protest could lead to a transfer or losing the opportunity to work at that company.

They also do not have any upward mobility and hold the same position for many years, without any incentives. The nature of such employment not only negatively impacts these employees but also the companies that hire them. Lack of accountability of these employees towards the employer, can resultin low quality production. Thus, an overwhelming number of manpower workers in a company can lead to long-term impacts in productivity, efficiency and economic growth. These workers also affect the permanent staff as they lose their bargaining power and dilute their rights.

What Should Be Done?

It is difficult to completely eliminate this type of labour as it has been integrated into the labour market. One option towards transforming manpower employment to decent work is to regulate "manpower business", while safeguarding rights of the workers.

Manpower workers are not protected by law; it is important to have regulatory mechanisms to protect their rights, including equality of employment conditions, and social protection. Therefore, as a first step, issuance of employment letters to all manpower workers should be made compulsory for companies that use such hired labour. Also, the government can play an exemplary role by ensuring the rights of manpower workers attached to state enterprises in terms of job security, wages, social security and other benefits, which permanent employees are entitled to.In addition, government enterprises should take immediate steps to stop recruiting agency hired workers for main business activities.

The use of temporary workers must be limited to legitimate needs – for example, to meet the seasonal demand of businesses, to provide supplementary services such as security, and janitorial services, etc. The contract period of seasonal workers should also be limited to a maximum of 6 months.

The plight of manpower workers points to the crucial need to address the issues they face. The effective implementation of these measures willbe a step towards transformingmanpower employment to decent work of greater quality for these employees.

(Priyanka Jayawardena is a Research Economist at the Institute of Policy Studies of Sri Lankan (IPS). To view the article online and comment, visit the IPS blog ‘Talking Economics’ –


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