This paper focuses on the section of plantation labourers, who are directly employed by the employers and are not contract workers. The paper shows that a high level of unionisation and adequate legislation in the plantation sector has not been effective in improving the conditions of the plantation labourers beyond a point. In the globalised scenario, the South Asian economies of India and Sri Lanka are facing competition in the plantation sector from China and Kenya. Hence, enhancing the productivity of the plantation labour would imply improving their conditions and bringing them into the mainstream of economic development. Accordingly, the paper suggests a two-pronged approach to the possible formalisation strategies for the plantation sector labourers.The paper also suggests that the effectiveness of any formalization strategy would require collective involvement and social dialogue among all the key players in the plantation sector.