Walihingage Karunarathne Silva vs Polytex Garments Ltd – SC APPEAL 94/2020-2022

In the case between Walihingage Karunarathne Silva and Polytex Garments Ltd (later Esquel Sri Lanka Ltd), the court addressed the issue of whether the compensation awarded for termination of employment was computed in accordance with relevant legal standards and whether it was excessive. The finding established that the Labour Tribunal’s initial award, upheld by the High Court, of three months’ salary per year of service was not legally justifiable given the respondent’s history of misconduct and the underlying legislative guidelines. The principle was reaffirmed that computation of compensation on termination must consider statutory provisions, established precedent, and the circumstances of the case. The decision relied on the Industrial Disputes Act and related statutes, emphasizing tha