STRABAG AG

VS.

COMMISSIONER GENERAL OF LABOUR AND OTHERS

COURT OF APPEAL
J. DE SILVA, J.
CA/WRIT/63/2017
AUGUST 29, NOVEMBER 21, 2018

Writ of certiorari-Employees' Provident Fund Act, No. 15 of 1958, sections 8(1) and (3), 10(2)-Goveming law clause in employment agreements-Applicability of EPF Act to foreign nationals employed in Sri Lanka-Waiver of the application of the EPF Act-Mandatory nature of the EPF Act

The petitioner employer employed the 4th respondent employee as the Project Manager in a project in Kataragama, which the former undertook pursuant to a Contract Agreement with the Government of Sri Lanka. Both the employer and employee are foreign nationals. The contract of employment between them contained the following choice of law clause:

Insofar as a matter is not specifically regulated in this contract, the Contract of Employment as per the Austrian Civil Code shall be used in addition. Austrian public labour, social and collective bargaining law, including the 'Betriebsverfassungsgesetz' (Industrial Constitution Law) are not applicable on principle.

The petitioner contended that this governing law clause has the effect of preventing the application of the EPF Act to the contract of employment and that the EPF Act does not apply to foreigners in view of the presumption in statutory interpretation that statutes are territorial in application.

The Commissioner of Labour directed the petitioner to pay EPF dues to the employee. The petitioner sought to quash this decision by a writ of certiorari.

Held :

1. The EPF Act applies to every person over a prescribed age who is employed by any other person in any covered employment. The Act provides that any employment may by regulation be declared covered employment.

2. The contention that the petitioner's employment is outside Sri Lanka because he is a foreign national working for a foreign organisation is unsustainable. Foreign nationals employed in Sri Lanka are not excluded from the application of the EPF Act.

3. Any interpretation that the EPF Act does not apply to foreign nationals working in Sri Lanka is counter-productive to. the Sri Lankan workforce in that it will facilitate the employment of foreign nationals in Sri Lanka at a lower cost to the employer than the employment of Sri Lankan citizens.

4. The application of the EPF Act cannot be waived by parties to a contract of employment which otherwise falls within the EPF Act.

5. The EPF Act is mandatory in nature and applies to the contract of employment between the petitioner and the 4th respondent.

Cases referred to:

1. International Science and Technological Institute Inc v. Rosa and another [1994] 3 Sri LR 233
2. Irish Shipping Ltd. v. Commercial Union Assurance Co PLC (1991) 2 QB 206, [1989] 3 All ER 853
3. Bianka Diamonds (Pvt) Ltd. v. Van Els (SC/APPEAL/52/95, SC Minutes of 15.02.1996) at 5
4. Shiyam v. Officer-in-Charge, Narcotics Bureau and another [2006] 2 Sri LR 156

5. Ceylon Agro Industries Limited v. Employees Trust Fund (CA PHC/40/2003, CA Minutes of 26.02.2016)
6. Crosley v. Arkwright (1788) 2 TR 603 at 608, (1788) 100 ER 325 at 328

APPLICATION for Writ of Certiorari.

Manoli Jinadasa for the Petitioner.

Chaya Sri Nammuni, S.S.C., for the 1st to 3rc1 Respondents.

cur. adv. vult.

January 23, 2020

J. DE SILVA, J.

The Petitioner is seeking writs of certiorari quashing the orders dated 03.10.2016 (P9) and 29.10.2016 (P10) made by the 3rd Respondent. These two documents contain decisions to the effect that there was a contract of employment between the Petitioner and the 4th Respondent in relation to which the Petitioner has failed to pay the Employee Provident Fund (EPF) contributions as required by the Employee Provident Fund Act, No. 15 of 1958 as amended (EPF Act) and action to be taken to recover the said dues.

Parties agreed that this matter can be disposed by way of written submissions. The Petitioner in