Business and Business Environment (BBE)

Basic of Law for

work and Life

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 Business and Business Environment (BBE)

Table of Contents
1.0 Introduction.................................................................................................................5
1.1. Introduction to Sri Lankan Law.............................................................................5
1.2. Introduction to Company.......................................................................................5
2.0 Issues in the company...............................................................................................6
2.1. Problem 01 - Wage is paid below decided level................................................6
2.2. Problem 02 - Workplace Discrimination Laws....................................................6
3.0 Importance of Employment Law and Contract Law in Sri Lanka.........................7
3.1. Importance of Employment Law in Sri Lanka.....................................................7
3.2. Importance of Contract Law..................................................................................8
4.0 Impact of Legislation on business............................................................................9
5.0 Differentiate between legislation and regulations................................................10
6.0 Conclusion................................................................................................................11
7.0 Refferenses...............................................................................................................11

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1.0 Introduction
1.1. Introduction to Sri Lankan Law
Sri Lanka's legal framework is complex and a mash-up of laws from Rome, England,
Holland, South India, and Old Ceylon. This rich legislative inheritance can be traced
back to the nation's religious and colonial history, which dates from 1505 to 1948.

The Supreme Court is the nation's highest court, followed by the Court of Appeal,
High Court, District Courts, Magistrates' Courts, and Primary Courts.

Supr
eme
Cour
t
Court of Appeal

High Courts
Provincial High Court
Commercial High Court
High Court of Civil Appeal
District Court

Magistrate's Court

Primary Court

The Sri Lankan Laws are intended to be a resource for both the legal community and
the general public.

Sri Lankan law (like other types of law) is derived from a variety of sources, as
follows:

a. The Roman Dutch law;

b. The English law;
c. The personal law;
d. Sri Lanka's statute law;
e. Indigenous customs (MATHEW, n.d.).

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1.2. Introduction to Company

Sandhunil Power Management Private Limited is a private company that was
founded on April 10, 2017. It is a non-government company that is registered under
the Companies Act No. 7 of 2007, Sri Lanka. It has a paid-up capital of Rs. 100,000
and an authorized share capital of Rs. 100,000. It is engaged in the production of
other electrical equipment.

Business Registration Number PV 10495

Company Name Sandhunil Power Management PVT Ltd.
Company Status Active
Company Sub Category Non-Government Company
Class of company Private
Date of Incorporation 10 April 2017
Activity Electrical equipment manufacturers

2.0 Issues in the company

2.1. Problem 01 - Wage is paid below decided level
Law - National Minimum Wage for Workers Act 2016

National minimum monthly wage for all workers in any industry or service is set as
10,000 (ten thousand) rupees and the national minimum daily wage of a worker is set
as 400 (four hundred) rupees.

Source - Source of this law is through Legislation as it has been created and passed
and published as a statue.

Real case - Up to 2012, Mexico had three minimum wage zones denominated A, B
and C. Zone A had the highest minimum wage and zone C, the lowest. At the end of
November 2012, the government unexpectedly announced that the minimum wage of
zone B would be equalized with that of zone A. Comparison of the figures for January
2012 and January 2013 show that this measure raised zone B’s minimum wage by
3.1% in real terms (a larger rise than in the other two zones). The step affected an
area of the country that accounts for roughly 10% of the population. Although the
minimum wage rise was relatively small, the fact that it was a completely exogenous
and arbitrary decision that affected one zone but not the others make it possible to
analyses its effects on the income and employment conditions of workers in Mexico.

2.2. Problem 02 - Workplace Discrimination Laws

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Law - Discrimination (Employment and Occupation) Convention, 1958

Convention concerning Discrimination in Respect of Employment and Occupation.

Real case - Starbucks employee Meseret Kumulchew was accused of fraud as her
employer claimed she was falsifying documents after she mistakenly entered
incorrect information when recording fridge temperatures in a duty roster. As a result,
she was given lesser duties, taking away vital parts of her supervisor position and
was told she needed to retrain before she could continue with those responsibilities
which made up the job she loves. The tribunal found that Starbucks failed to make
reasonable adjustments for Meseret and had discriminated against her due to the
effects of her Dyslexia. It was also found that she was victimized by her employer
and that there appeared to be little or no knowledge or understanding of equality
issues within the business.

3.0 Importance of Employment Law and Contract Law in Sri Lanka

3.1. Importance of Employment Law in Sri Lanka
What exactly is employment law? Employment law works to protect the rights, safety,
and health of both employees and employers. Employment law was also created to
give businesses and organizations the ability to be consistent, clear, fair, and
transparent. Simply put, employment law governs all aspects of the employer-
employee relationship (Minhaslawyearsad, 2021).

Sri Lankan employment laws make no distinction between foreign and domestic
employees and apply equally to both, regardless of whether the employment is
regular, fixed-term, casual, or seasonal. The following are the main employment
provisions:

 Shop and Office Employees (Regulation of Employment & Remuneration) Act

No 19 of 1954 and amendments to this Act.
 Wages Board Ordinance No 27 of 1941 and amendments to this Ordinance.
 Factories Ordinance No 45 of 1942 and amendments to this Ordinance.
 Industrial Disputes Act No 43 of 1950 and amendments to this Act.
 Workmen's Compensation Ordinance No 19 of 1934 and amendments to this
Ordinance.
 Trade Union Ordinance No 14 of 1935 and amendments to this Ordinance.
 Maternity Benefits Ordinance No 32 of 1939 and amendments to this
Ordinance.

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 Termination of Employment of Workmen (Special Provisions) Act No 45 of

1971 and amendments to this Act.
 Employees Provident Fund Act No 15 of 1958 and amendments to this Act.
 Employees Trust Fund Act No 46 of 1980 and amendments to this Act.
 Payment of Gratuity Act No 12 of 1983 and amendments to this Act.
 National Minimum Wages of Workers Act No 3 of 2016.
 Budgetary Relief Allowance Act No 4 of 2016.
 Inland Revenue Act No 24 of 2017 (Saram, et al., 2020).

Employees and employers are both protected by employment law. It ensures that
their employer does not discriminate against, harass, or unlawfully terminate them.
Employment laws ensure that employees fulfill their contractual obligations.

While employment lawyers fight for employees, it is still critical for workers to
understand their rights, which are established by laws and the Age Discrimination in
Employment Act.

This section provides an overview of why employment law is important for both
employers and employees (Esq & Brown, 2020).

 Important for Business Success

 Both the employer and the employee are protected.
 Provide Economic Stability
 Discrimination in the workplace is prohibited by law.

As a result, employment laws are important in business operations because every

decision must be made within the confines of the employment law. Both the employer
and the employee must understand these laws so that no employment law terms are
violated on the job (Studyamarter, n.d.).

3.2. Importance of Contract Law

The term "contract" refers to a legally binding agreement. Contracts are essential in
our daily lives. In general, a contract can be made between two different individuals
or two different organizations by exchanging promises.

The terms contract and agreement may be used to refer to a similar theme; however,
as a general rule, the terms 'contract' and 'agreement' can differ. All contracts will be
agreed upon, but not all agreements will be reduced by the law. At some point, the
gathering of agreement may fail to form legitimate relationships due to the lack of
consideration for the illicit motivation behind the understanding.

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One of the most important aspects of the contract that many people overlook is that it
must be in written form in order to be legally binding. Even an oral promise can be a
legal or valid contract if the following conditions are met (Kiron, 2018).

A contract's fundamentals are as follows:

 Offer
 Acceptance of the offer
 Intention to create legal relations
 Consideration
 Certainty
 Capacity
 Free Consent

Contract law pervades all aspects of our lives. Contracts are created all around us,
from employment to transportation to social and recreational activities like buying a
drink at the pub. While the majority of such agreements are short-lived and the terms
are simple and unobtrusive, breaches of such agreements can still be enforced with
the full force of the law as with more serious forms of contract.

Contract law must evolve in response to changes in economics, technology, and

social attitudes. It is usually the responsibility of Parliament to intervene and legislate
for new situations, as well as to introduce legislation that governs specific
relationships and the contracts that arise between them. It is, however, impossible to
legislate for all possible outcomes because a situation may arise that was not
anticipated, or the technology, issue, or relationship that it was intended to regulate
may have evolved. It is then up to the Courts to interpret the law in order to resolve
any disputes. This was the state of contract law in 1818 with the case of Adams v.
Lindsell, and it is likely to remain so for the foreseeable future. While the variety and
scope of contracts evolve and expand, the general principles discussed above
remain applicable.

4.0 Impact of Legislation on business

The government uses legislation to regulate business behavior and prevent people
from being exploited. Laws protect both consumers who buy from businesses and
employees who work for businesses.

Costs and profits

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Businesses must comply with government legislation, but this comes at a high cost in
terms of both time and money. Some of these expenses are incurred as a result of
the time required to create documents, follow procedures, and ensure legal
obligations are met.

Marketing and sales

There are several benefits and drawbacks to marketing and sales legislation:

 ensures a strong brand image and reduces the possibility of impersonation by

other brands and products
 Customers are less likely to sue if there are fewer returns.
 increased sales

Legislation-related issues for marketing and sales include:

 Any issues with products could have a negative impact on sales. Complying
with all laws can be costly, increasing the importance or generating more
sales.

Production

The benefits and drawbacks of legislation to production are numerous.

Legislation has the following advantages:

 Customers may have more confidence in the products if they have high-
quality products
 employees may be more productive if they have good working conditions.

Legislation has the following disadvantages:

 Productivity may be reduced by adhering to working time requirements if all

products and services are produced to satisfactory levels using high quality
materials.

5.0 Differentiate between legislation and regulations

Legislation and regulation are two terms that frequently confound people who are
unfamiliar with legal terminology. Law is one of the most complicated subjects, with
numerous terms and words that frequently mean different things in different contexts.
These two words are examples of such words. Legislation refers to laws enacted by
the legislature or laws in the process of being enacted, whereas regulations refer to
the process of monitoring and enforcing a law as well as a document containing the

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details of a written rule. These two should not be confused because they are
completely different.

Another term for statutory law is legislation. These laws were enacted by a country's
legislature or governing body. Legislation can also refer to the process of enacting
legislation.

Regulations can be used to define two things: a process for monitoring and enforcing
laws, and a written instrument containing rules with legal implications.

Legislation and regulations are fundamentally different. While the government or

legislature passes legislation, it is up to regulations to ensure and enforce the law. It
is capable of upholding and regulating the laws that govern the people.

6.0 Conclusion
An understanding of laws and legislation has been explained in the context of some
examples in this section. Contract law and employment had been developed, as had
the significance of the English Legal System. Finally, the distinction between
regulations and legislation was explained.

7.0 Refferenses

Esq & Brown, C., 2020. Why Is Employment Law Important?. The Brown Firm PLLC.

Kiron, M. D. M., 2018. The Importance of the Law of Contract. Grin, p. 15.

MATHEW, C. P. J. W., n.d. C.Mathew & Co.. [Online]

Available at: http://www.cmathew.com/family-matters/divorce-in-sri-lanka/262-sri-lanka-
law
[Accessed 19 January 2023].

Minhaslawyearsad, 2021. Employment Law. Minhas Lawyers.

Saram, F. D., Saram, D. L., Cooray, D. & Goonetilleke, J., 2020. Employment and employee
benefits in Sri Lanka: overview. Thomson Reuters.

Studyamarter, n.d. Study smarter. [Online]

Available at: https://www.studysmarter.us/explanations/business-studies/influences-on-
business/employment-law/
[Accessed 20 January 2023].

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