Can a developing democracy benefit from labour repression? Evidence from Sri Lanka

While a growing body of academic literature casts doubt on the wisdom of authoritarian responses to labour in developing democracies, few empirical studies demonstrate the adverse effects of excluding organised labour from the policy arena or repressing trade unions in the industrial relations arena. This paper draws on the recent history of state-labour relations in Sri Lanka to help fill this gap. Beginning in the late 1970s, the Sri Lankan government adopted a labour-repressive export-oriented strategy of development. The author shows how the repression of private sector unions during this period destroyed the legitimacy of traditional left unions and the structure of institutionalised bargaining that was in place prior to Sri Lanka's authoritarian period. This erosion of the system of institutionalised bargaining eventually led workers to shift their support to more radical, 'new left' unions and culminated in a wave of extreme and violent forms of protest that chased away much needed foreign direct investment. The chaotic consequences of the labour repression suggest two primary conclusions: (a) that prior democratic mobilisation may make labour repression untenable over the long term; and (b) that repression may backfire, creating bursts of highly visible and destabilising protest that undermine the developmental objectives of neoliberal reforms.