CPD suggests new wages within a year for sectors with stagnant pay  

Highlights

• CPD urges legal measures for wage delays and overtime violations  
• 95 wage-related recommendations made to strengthen labour rights in Bangladesh  
• CPD calls for national minimum wage board for all sectors  
• It highlights 80% of labour rights complaints are wage-related
• Reform Commission head calls for equal protection for informal sector workers

The Centre for Policy Dialogue (CPD) has recommended implementing new wages within a year for sectors where wages have not been updated in the last five years. 

"Make a major revision to all sectoral minimum wages set more than five years ago within the next year, prioritising the oldest ones first," said CPD Senior Research Associate Tamim Ahmed at a discussion on Sunday (12 January). 

The event – titled "Reform in Workers' Livelihood, Workplace Safety, and Rights: An Agenda for the Interim Government," was organised at the CPD office in the capital in collaboration with Christian Aid.

The think tank proposed 95 measures, including a legal provision requiring employers to compensate workers for delayed wage payments and making non-payment of overtime a punishable offense. 

Other recommendations include raising penalties for failing to pay the minimum wage, introducing a wage guarantee insurance scheme, and granting magistracy powers to the Department of Inspection for Factories and Establishments (DIFE) to take action against non-compliance. 

CPD also suggested removing the minimum threshold required to form a trade union, currently set at 20% of workers in a factory.

There are 42 sectors covered by minimum wages, but 19 of them have not updated their wages in five years, according to data of the minimum wage board. The informal sector, which covers 85% of the total labour force, includes industries not covered by the 42 sectors. 

According to the independent think tank, there are about 140 sectors and sub-sectors in the country, both formal and informal. It has proposed establishing a minimum wage board for all sectors.

Khondaker Golam Moazzem, research director of the CPD, said, "We estimate there are about 140 sub-sectors in total. Currently, 42 sectors in Bangladesh are under the National Minimum Wage Board." 

"Our suggestion is to include those outside the wage board in the National Minimum Wage, which will make the process of reaching a national minimum wage easier," he added.

While most industrial factories in the country are covered by existing labour laws, the Export Processing Zones (EPZs) operate under a separate law. The Dhaka-based think tank has suggested bringing all labour sectors under the same law. 

CPD's Tamim Ahmed recommended that those who repeatedly fail to implement the minimum wage without reason be brought under the peace agreement. 

He emphasised that wages are a critical aspect of labour rights, noting that 80% of labour rights complaints are related to wages. 

A 2021 report by the International Labour Organization highlighted that Bangladesh is the only country in the Asia-Pacific region where wages fall below the International Lowest Poverty Line.

He also suggested declaring a national minimum wage day to raise awareness. The issue of bribery among DIFE officials, who oversee labour matters, was also discussed. 

Tamim said, "It is reported that DIFE inspectors often demand bribes during factory inspections, and sometimes harass factory owners even when everything is fine." 

Additional payment for delayed wage payments  

CPD has proposed a new provision requiring employers to compensate workers for delays in wage payments. 

"Introduce a legal obligation mandating additional payments for each day wages are delayed," said Tamim Ahmed. 

While presenting the keynote, he also proposed significantly increasing penalties for failing to pay the minimum wage, especially in cases of deliberate and repeated violations. 

Although minimum wages are set across 42 sectors in Bangladesh, they are often not revised periodically. Even in sectors with established minimum wages, implementation remains inadequate, he said.

"Following the 2018 minimum wage declaration in the garment sector, a study revealed that after three years, 40% of workers still had not received the government-declared minimum wage," Tamim told The Business Standard after the programme. 

He also pointed out that some factories fail to properly compensate for overtime work, despite it being legally required. CPD proposed categorising such violations as punishable offenses under the law.

The think tank emphasised strengthening government oversight of labour rights issues. 

"Make it mandatory for the DIFE to produce a wage implementation assessment report within four months of setting a new minimum wage, and publicly disclose the names of non-compliant establishments," Tamim suggested. 

CPD has put forward 95 wage-related recommendations for short- and mid-term implementation. Minimum wages should be guaranteed for all types of contract-based workers, including those temporarily hired through third parties with legal provisions, said the think tank. 

They also recommended setting all minimum wage structure allowances – such as the housing allowance – as a percentage of the basic salary rather than a fixed amount.

National minimum wage for all  

Tamim presented a keynote paper at the event, where they recommended introducing a national minimum wage for all. 

Syed Sultan Uddin Ahmed, head of the Labour Reform Commission, said, "There are 8 crore workers in our country, 85% of whom are in the informal sector. However, they are not protected much." 

He said that 85% of the country's workers, or about six crore, lack legal protection, wage standards, and social recognition. 

He said, "Even after 53 years of independence, it cannot be accepted that workers will take to the streets demanding wages and be shot to quell them. Why is there no talk, no discussion inside the factories?"

He also said the universal pension scheme does not include hawkers, labourers, and domestic workers. 

"We are trying to form a proposal by including everyone by ensuring labour rights. It is essential that everyone has access to wage standards, social protection, and organizational rights. This will establish a fair share in a dynamic economy," he added.

Christian Aid Bangladesh country director Nuzhat Jabin said, "The reforms should adhere to international standards. Human rights principles must be respected, and workplace dignity and rights should be upheld."

Taslima Akhter Lima, a member of the Labour Reform Commission and president of the Labour Federation, Farooq Ahmed, secretary-general of the Bangladesh Employers' Federation, and others also discussed the issue.