Sri Lanka’s IT-BPO (business process outsourcing) sector has emerged as a significant contributor to the economy of the country transitioning from being dominated by manufacturing to one that’s focused on services. 

The island nation is rapidly emerging as a premier outsourcing destination for multinational companies due to several key factors. Sri Lanka’s workforce is noted for higher productivity and quality compared to other nations. The country’s ability to offer skilled labour at a lower cost makes it a competitive destination for IT-BPO services. English being the primary business language in Sri Lanka, gives it a competitive advantage for outsourcing work from Western firms. The proficiency of Sri Lanka’s English-speaking workforce contributes to high-quality output, enhancing return on investment (ROI), and allowing companies to boost employee incentives. Additionally, the population possesses significant expertise in accounting and Knowledge Process Outsourcing (KPO), further strengthening Sri Lanka’s appeal as an outsourcing hub where barriers to entry are low.

As per media reports, the Information Technology and Business Process Management or IT-BPM industry has become Sri Lanka’s fourth-largest foreign revenue earner. According to experts, IT-BPO services earn substantial revenue for the nation and the sector aims to generate income in excess of US$ 30 billion by 2030. There is also a large presence of female employees in the sector. This gender diversity contributes to a more inclusive and innovative work environment. As per Sri Lanka Association of Software and Service Companies (SLASCOM), the national chamber in Sri Lanka for national IT-BPO, Sri Lanka is home to more than 300 IT and BPO companies.

Certain labour laws in Sri Lanka have been criticized for placing restrictions on a woman’s right to engage in night work. Section 10 of the Shop and Office Employees (Regulation of Employment and Remuneration) Act, No. 19 of 1954 imposed restrictions on female workers, prohibiting them from working before 6 a.m or after 6 p.m on any day. However, exceptions have been made for women working in hotels, airlines, and hospitals.  In certain jobs such as in the hotel and tourism industry, the cutoff working time for women is 10 pm. One could argue that these constraints on working times not only limit the number of hours for which a woman can earn, but also deter employers from recruiting female candidates as, after a particular time, a male counterpart is required to take over. This often acts as reasoning for employers to prefer male candidates over women applying for the same job role.

A recent amendment titled the Shop and Office Employees (Regulation of Employment and Remuneration) (Amendment) Act, No. 28 of 2024, certified on 13 May 2024, introduces several significant changes to the principal enactment. This initiative marks a significant move towards establishing gender inclusion in the workplace, particularly in sectors crucial to the nation’s economic development and global commerce.

Making changes to Working Hours, Section 10 is amended to clarify and extend permissible working hours for female employees. Females who are at least 18 years old may now work in certain industries, such as IT and BPO, before 6.00 a.m. or after 6.00 p.m. on any day.

Further, providing Welfare and Security Provisions, Section 66 is revised to ensure employers provide specific welfare measures for female employees working late hours. This includes security, transport facilities, and resting facilities for females employed after 10.00 p.m. and before 6.00 a.m.

Section 68 expands the definition of “office” to include institutions engaged in IT, knowledge process outsourcing (KPO), business process outsourcing (BPO), and related administrative and accounting work for institutions abroad.

The changes to the labour law in this juncture are significant since Sri Lanka is in vulnerable place economically and needs as much foreign direct investments into sectors that can support generate foreign income. Laws must also facilitate young graduates to remain in the country since Sri Lanka's skilled and educated youth consider migration as their preferred option. Since the majority of university graduates are female, it is imperative the legal framework supports policies and laws such as this that can bring these educated women into the labour force.