Understanding the Sri Lanka Shop & Office Employees Act and Wages Board Ordinance

Knowing your rights and responsibilities as an employer or employee is essential for creating a fair, transparent workplace. Sri Lanka’s Shop and Office Employees Act and related labour laws set out the standards for working hours, leave, holidays, and remuneration for private-sector workers.

This guide summarizes the key provisions — so you can understand how your entitlements are protected under Sri Lankan labour law.

🏢 Who Is Covered

The Shop and Office Employees Act (No. 19 of 1954) applies to anyone employed in or about the business of a shop or office, including:

• Retail or wholesale businesses, hotels, cafés, restaurants, barber or salon services, and similar trades

• Offices related to banks, insurance companies, shipping firms, brokers, advertising or commission agents, accountants, estate agents, and similar professional or commercial establishments

• Administrative or clerical departments within factories, estates, media houses, and transport companies

Essentially, if your workplace operates as a business, trade, or professional service — chances are you’re covered.

💰 Definition of “Remuneration”

Remuneration includes:

• Base salary or wages

• Cost of living allowance

• Overtime pay

• Any other legally prescribed allowance

Full remuneration means your normal rate of pay — the same rate you earn for a regular working day — when you take approved leave or holidays.

⚠️ Note: The separate Budgetary Relief Allowance (BRA) is no longer in effect as of 1 April 2025. Its value has been incorporated into the statutory national minimum wage.

⏰ Overtime and Allowances

Overtime is any work performed beyond the standard daily or weekly limit set out in the Act.

• Overtime must be calculated based on the employee’s normal hourly rate, typically at 1.5× the regular rate unless a Wages Board specifies a higher rate

• Industry-specific Wages Boards may still publish schedules with additional allowances, but all wages must comply with the statutory minimum wage

🗓️ Leave and Holidays

Weekly Holidays

Every employee must receive one full day and one half-day off each week with full pay, provided they have worked at least 28 hours (excluding overtime) during that week.

Annual Leave

Shop & Office Employees Act

For employees under the Shop & Office Employees Act, annual leave entitlements for the first year depend on employment start date:

• Jan 1 – Mar 31: 14 days

• Apr 1 – Jun 30: 10 days

• Jul 1 – Sep 30: 7 days

• Oct 1 – Dec 31: 4 days

From the second year onward, employees are entitled to 14 days of annual leave each year, with at least 7 consecutive days.

Wages Board Employees

Employees covered under a Wages Board are entitled to annual leave as prescribed by the relevant Wages Board for their industry or trade.

• This may differ from the Shop & Office schedule

• Wages Boards typically specify:

  • Number of leave days per year

  • Rules for taking consecutive days

  • Payment during leave (usually at normal rate or according to the minimum wage)

• Employees should refer to the official Wages Board Gazette for exact entitlements

⚠️ Important: Regardless of Wages Board provisions, all paid leave must ensure compliance with the national minimum wage.

Casual Leave

Employees are entitled to 7 days of casual leave per year for personal matters, illness, or other reasonable causes. During the first year, leave is earned at 1 day for every 2 months of completed service.

Poya Day Leave

Every employee is entitled to a paid holiday on each Full Moon Poya Day. If a Poya Day coincides with another official holiday, no extra day is granted in lieu.

Public Holidays

Employees are entitled to up to 9 paid public holidays each year, as declared by the Minister through the Government Gazette.

⚖️ Minimum Wage & Wages Board

National Minimum Wage

As of 1 January 2026, all private-sector employees are entitled to a statutory minimum wage:

• Monthly minimum wage: Rs. 30,000

• Daily minimum wage: Rs. 1,200

This applies across all sectors and includes any previous allowances like the BRA.

Wages Board Ordinance

The Wages Board Ordinance still governs industry-specific minimum wages, overtime, working hours, and conditions for various trades.

Key Terms:

• Trade: Any business, profession, or industrial undertaking (except those run for training or charitable purposes)

• Worker: Anyone employed to perform work in a trade

• Wage: Includes normal pay, overtime, and holiday pay

• Wage period: The specific period for which wages are payable

Employees should refer to the official Wages Board Schedule published in the Gazette for trade-specific conditions and allowances, but all wages must comply with the national minimum wage.

💡 Why This Matters

Understanding these laws protects both employers and employees:

• For employers, it ensures compliance and avoids penalties

• For employees, it guarantees fair treatment, proper pay, and awareness of entitlements

With HR360, all these standards — from leave tracking to overtime and payroll calculations — are built into the system automatically. Businesses stay compliant, and employees can rest assured their rights are respected.