Sri Lanka
Make employment in Sri Lanka easy. Let us handle payroll, benefits, taxes, compliance, and even stock options for your team in Sri Lanka, all in one easy-to-use platform.
- Capital City
Sri Jayawardenepura Kotte (legislative) Colombo (executive and judicial)
- Currency
Sri Lankan rupee (Rs, LKR)
- Languages
Sinhala, Tamil, and English
- Population size
21,803,000
Facts & Stats
- Capital City
Sri Jayawardenepura Kotte (legislative) Colombo (executive and judicial)
- Currency
Sri Lankan rupee (Rs, LKR)
- Languages
Sinhala, Tamil, and English
- Population size
21,803,000
- Ease of doing business
Medium
- Cost of living index
31.18 (2021)
- Payroll frequency
Monthly
- VAT - standard rate
8%
- GDP - real growth rate
2.3% (2019)
The Democratic Socialist Republic of Sri Lanka is an island nation just off the coast of India, famous for its rich cultural heritage, unique biodiversity, and a long history of tea production. The natural beauty of Sri Lanka is becoming more of a magnet for tourists and digital nomads as the cost of living is relatively low (especially when you factor in the allure of the pristine beaches in the nation’s south). Sri Lanka has one of Asia’s most literate populations, the education system is strong, and English is widely spoken, so global employers should consider this country’s top talent.
Grow your team in Sri Lanka with Remote
Looking to employ workers in Sri Lanka? Companies hiring in Sri Lanka must either own a legal entity in the country or work with a global employment solutions provider, usually one that provides employer of record services.
Remote can employ your team in Sri Lanka on your behalf through our local legal entity in the country and handle payroll, benefits, taxes, and compliance for your Sri Lanka team. You can also pay contractors now in Sri Lanka with Remote.
Risks of misclassification
Sri Lanka, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in Sri Lanka may lead to fines and penalties for the offending company.
Employing in Sri Lanka
Provisions for employee protections and workers’ rights in Sri Lanka are spelled out across several government statutes, such as:
The Shop and Office Employees Act of 1956
The Factory Ordinance
The Minimum Wage Ordinance, and
The Maternity Benefits Ordinance
Employees in Sri Lanka enjoy protection against discrimination based on age, religion, gender expression, and race.
Common questions that could come up during the hiring process include the minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Sri Lanka.
Minimum Wage
The monthly minimum wage in Sri Lanka is fixed at 12,500 LKR and daily wage of worker is fixed at 500 LKR.
Onboarding Time
We can help you get a new employee started in Sri Lanka fast. The minimum onboarding time we need is only 18 working days.
Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.
For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.
Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.
25 Public holidays
Want to see and manage all holidays? Sign up for our free HRIS!
Effortless HR in Sri Lanka: Take the Tour
Competitive benefits package in Sri Lanka
At Remote, we’re obsessed with helping you craft the best possible employee experience for your team. We are leading the way in practicing “fair equity,” which means making sure employees everywhere have access to both the required and supplemental benefits they need to thrive (and that will allow you to attract the best local talent).
Our benefits packages in Sri Lanka are tailored to fulfill the local needs of your employees. Typically, our packages contain some or all of the following benefits:
Health Insurance
Dental Insurance
Vision Insurance
Mental Health Support
Pension or 401(K)
Life and Disability Insurance
Taxes in Sri Lanka
Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Sri Lanka.
12%
Provident Fund
3%
Employee Trust Fund
Types of leave
Employees are entitled to 14 days of paid annual leave after they’ve worked an entire year with an employer.
Employment termination
Termination process
Employees can either be dismissed summarily - if just cause if provided - otherwise, termination must be in accordance with the terms stipulated in the employment contract. A decision to let an employee go must be approved by the Labour Commissioner.
Notice period
There is no minimum notice period under Sri Lankan law but it’s common to notify employees at least six months before termination.
Severance pay
Employees are only entitled to severance payment proportional to their tenure working with an employer — if they’re dismissed unfairly.
2.5 months pay per year for years 1 - 5, capped at 12.5 months pay
2 months pay per year for years 6 - 14, capped at 30.5 months pay
1.5 months pay per year for years 15 - 19, capped at 38 months pay
1 month pay per year for years 20 - 24, capped at 40 months pay
Half a month’s pay per year for years 25 - 34, capped at 48 months pay
Probation periods
Probation periods range from six months for general staff, to 12 months for technical or supervisory staff.
Fair Pricing in Sri Lanka
Employer of Record
Hire and pay your global team
Starting at $599/month
for annual plans
Top features
Satisfaction guaranteed
No deposits or hidden fees
Zero onboarding or offboarding fees
Compliant equity incentives support including withholding and reporting
Built-in security and compliance
Fast onboarding (average 2-3 days)
Flexible, localized benefits
Top features
Only pay for contractors you actively work with
Work with contractors in 200+ countries
Create, edit, and sign tailored, localized contracts
Approve contractor invoices with one click or auto-pay
Transparent payments with complete visibility
Remote Payroll
Consolidate your multi-country payroll
$50
per employee/month
Top features
Reduce costs by centralizing payroll management
Ensure local compliance for every country
Direct support from in-house local payroll experts
Accurate, on-time, compliant payroll to level-up your employee experience
Tax and labor authority reporting handled for you
Top features
Guided onboarding and offboarding
Employee profile and document management
Time and attendance (time off and tracking)
Expense management and reimbursement
Employee self-serve on the platform and mobile app