Mathews' annual fee fell from $130,000 a year to $80,000 while Karunaratne was offered $70,000, a drop of $30,000
Sri Lanka national players are refusing to sign new contracts that see their payments slashed by up to 40%, a lawyer representing them said Friday.
The squad, who say they are being held "at gunpoint", are particularly angry at the role played by former Australia star Tom Moody who is part of a national board panel that proposed the new contracts.
While no threat of a strike has been made, former captain Angelo Mathews and Test captain Dimuth Karunaratne - who suffered the biggest cuts - were dropped from a tour of Bangladesh.
Mathews' annual fee fell from $130,000 a year to $80,000 while Karunaratne was offered $70,000, a drop of $30,000.
Minus the two star players and with the showdown growing, the team are in Bangladesh preparing for three one-day internationals starting Sunday.
Lawyer Nishan Premathiratne on behalf of 24 national players said in a statement that the players hoped to resolve the spat with board president Shammi Silva who was re-elected for a second two-year term Thursday.
A national player told AFP that the board had violated confidentiality by publicly disclosing the squad's proposed salaries.
Former Sri Lanka Test player and coach Chandika Hathurusingha, who was sacked in 2019 after Sri Lanka's early exit from the World Cup, was reportedly paid in excess of $40,000 a month.
Sri Lanka Cricket said players could earn more under the new performance-based pay scheme formulated with the help of former skipper Aravinda de Silva and Moody.
The Australian was hired in March as the Sri Lankan board's director of cricket to prepare the team for the next World Cup.
Moody told reporters Wednesday that the panel had studied pay structures in other nations before coming up with its scheme.
The 24 national players are offered annual contracts with all-rounder Dhananjaya de Silva and wicket-keeper Niroshan Dikwella getting the highest remuneration of $100,000 each.
However, both have rejected the new pay deal, according to their lawyer.
SLC officials said the base fees in the new contracts were in addition to payments for each match as well as allowances for travel outside Colombo.
Shammi told reporters after his re-election that he believed that the players had the potential to earn more and help Sri Lanka improve its rankings.
Sri Lanka is ranked eighth out of the 10 Test nations, ninth in one-day internationals and eighth in Twenty20 rankings.
Cash-strapped after a number of tours were cancelled last year because of the coronavirus pandemic, Sri Lanka has persuaded India to play extra games on a tour in July so that it can earn increased television revenue.