March 30, 2020

Bangladesh’s Cabinet Approves Changes to Labor Laws

The new initiatives are partly in response to outrage over conditions in the country’s garment sector after the April 24 collapse of a garment-factory building, Rana Plaza, in Savar, an industrial suburb of Dhaka, the nation’s capital. By Monday afternoon, at least 1,127 people were confirmed to have died in the Rana Plaza collapse, a number that could still rise, in what is now considered the deadliest disaster in the history of the garment industry.

A top adviser to Bangladesh’s prime minister, Gowher Rizvi, said the changes approved by the cabinet – which must still be approved by the country’s Parliament – are part of a broader government effort to come into compliance with international labor standards and improve conditions for workers in an industry that is critical to the nation’s economy.

“Worker safety and worker welfare have now been brought into the forefront,” Mr. Rizvi said in a telephone interview. He said that discussions on these changes predated the Rana Plaza collapse even as he agreed that the disaster had intensified the pressure for reforms.

“This is the goose that lays the golden egg,” he said of the garment industry’s importance to Bangladesh. “Don’t kill it. We have to strengthen it. We have to nurture it. Nurturing it means fair treatment of the workers.”

Bangladesh is now the world’s second-leading garment exporter, trailing only China, and has become a popular manufacturer for top global brands by delivering lower costs, largely because of rock-bottom wages. Minimum wage in the garment industry is $37 a month. Labor unions are largely absent in garment factories, partly because of legal restrictions on organizing. In some cases, workers trying to organize unions have faced dismissals from factory bosses, as well as intimidation and harassment from local officials.

Mikail Shipar, the country’s labor secretary, said Monday’s changes included eliminating a central restriction on union organizing and improving benefits for workers. Under the current rules, organizers must present the government with a list of names showing that at least 30 percent of workers in a factory want a union. But that list is then turned over to a factory’s owner to verify the authenticity of the names – a step that some owners have used to engage in union busting by firing or harassing workers on the list.

Now, Mr. Shipar said the list would no longer be turned over to factory owners.

“This is a major barrier in getting registration of a trade union in a factory,” he said. “Through the proposed amendment of the labor law, we removed this barrier.”

Other changes involve benefits. Severance payments will be increased for workers with longer tenures at factories; annual payments under a welfare fund will be equalized so that every garment worker, regardless of the size of their factory, will receive the same amount. Factories will be pushed to modernize management practices and provide workers with banking accounts and direct deposit to protect against abuses by lower-level managers, like withholding or delaying wages.

Government officials on Sunday announced the creation of a new wage board that would begin discussions between labor and management on setting a new minimum wage for garment workers. Mr. Shipar said the process might take up to six months, but officials have said that any wage changes would be retroactive to May 1.

Bangladesh has roughly 5,000 garment factories, employing directly and indirectly more than 4.5 million people. Nearly 80 percent of garment workers are women, many of them poorly educated and from rural villages. In the past, even the low local wages were better than working in the fields. But as inflation has spiked in the past two years, garment workers have staged angry protests, demanding higher wages and better conditions.

Mr. Rizvi, the government adviser, said the move by the cabinet on Monday is part of a broader effort to bring Bangladesh into compliance with minimum labor standards established by the International Labor Organization. This month, a high-level delegation from the organization met in Dhaka with factory owners, government officials and labor leaders and issued a joint statement pledging to introduce a labor law reform package in Parliament; to assess the structural integrity and fire safety of all factories in 2013; and hire an additional 200 government inspectors to regulate the industry.

Julifkar Ali Manik contributed from Dhaka, Bangladesh.

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