Facts & Stats
Sri Lanka privileges a well-educated and skilled workforce, making it an attractive destination for businesses.
The country offers competitive labor costs compared to many Western countries.
Hiring in Sri Lanka requires compliance with local labor laws and regulations.
The Evolution of Remote Work
Sri Lanka, like many other countries, has witnessed the growth of remote work, driven by technological advancements and the global shift towards flexible work arrangements.
Regulatory Considerations
Companies embracing remote work must navigate regulatory nuances, including tax implications, employment laws and data privacy regulations, both in Sri Lanka and the employees' home countries.
Upholding Employment Regulations
Sri Lanka's labor laws encompass a wide range of aspects, including employment contracts, working hours, minimum wage (which exists in certain sectors), and employee rights. Adhering to these laws is essential for businesses.
Employment contracts are fundamental in Sri Lanka. They detail terms such as salary, benefits, working hours, notice periods and termination procedures, providing legal protection for both employers and employees.
Sri Lanka typically follows a 45-hour workweek, usually spread across five days. Overtime pay applies when employees work beyond their regular hours.
Managing employment taxes in Sri Lanka involves observing to income tax regulations and contributions to statutory funds like the Employees' Provident Fund (EPF) and the Employees' Trust Fund (ETF).
If the employee is a non-resident in terms of the provisions of the Inland Revenue Act (whether he is a citizen in Sri Lanka or not), the tax should be deducted, by the employer at the rate of 36%, unless otherwise an instruction has been issued by the Commissioner General or any officer authorized by The Secretariat considering special circumstances.
Small and medium-sized businesses (SMEs) that operate in Sri Lanka, don't have a legal associate and have a yearly revenue of under 500 million Sri Lankan rupees (LKR), Corporate Income Tax will be applicable from 14 – 30 %.
While not mandatory, some employers offer health insurance to employees as part of their benefits package, promoting employee well-being.
Female employees in Sri Lanka are entitled to maternity leave, typically ranging from 12 to 84 days, depending on factors such as the number of children and the type of employment.
Sri Lankan labor law mandates paid sick leave for employees who are medically certified as unfit for work. The duration of sick leave varies based on factors like employment type and length of service.
Employees in Sri Lanka are entitled to annual leave, typically ranging from 7 to 28 days, depending on factors like years of service and the industry.
Sri Lanka has detailed severance laws that outline notice periods, termination reasons and compensation in cases of termination.
Termination procedures in Sri Lanka include notice periods, valid reasons for termination, and the return of company property. Fair employment practices are essential when navigating these regulations.
Providing competitive compensation packages, including salary, bonuses, and benefits, is crucial for attracting and retaining talent in Sri Lanka's competitive job market.
Expanding your business into Sri Lanka is a strategic move, and partnering with a Sri Lanka EOR or PEO service can streamline the process. These services provide a solid foundation for HR and compliance, ensuring a smooth transition into the dynamic Sri Lankan business landscape.
e-square EOR and PEO services in Sri Lanka help businesses simplify HR and compliance processes, including payroll management, tax compliance, and employment regulations, allowing you to focus on core business activities.
Some EOR and PEO services may assist with immigration-related issues for foreign employees in Sri Lanka, such as work visas and compliance with immigration laws.
Yes, EOR and PEO services can help navigate the complexities of remote work in Sri Lanka, including compliance with local regulations and tax considerations.
Yes, your business retains control of day-to-day operations and decision-making. e-square EOR and PEO services focus on specific employment-related tasks, allowing you to concentrate on your core business objectives.
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