Tk12,500 minimum wage finalised for RMG, calls for increases unheeded 

The government has finalised Tk12,500 as the minimum wage for garment workers, rejecting the demand for an increase from various labour organisations.

However, the total number of pay grades has been reduced to four and the wages have been slightly increased, Chairman of the Minimum Wage Board Liaquat Ali Molla made the disclosure at a press conference in the Secretariat after the board's 7th meeting yesterday.

According to the previous proposed five-grade calculation, the wages for workers classified under Grade-5 (helpers) and general operators in Grade-3 are not set to increase. However, in the other three grades, wages are expected to rise from Tk123 to Tk525. 

Earlier, the minimum wage was increased by 56% to Tk12,500 in the lowest grade among the five grades. Rejecting this, a number of workers took to the streets, and a total of four people were killed during protests over the wage, including two people in a clash with police.

Siddiqur Rahman, owners' representative on the wage board and former president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), welcomed the revised wage structure. "This decision was made unanimously; no party has any objection. This salary is satisfactory," he said.

Sirajul Islam Rony, labour representative and president of the Bangladesh National Garment Workers League, has accepted the new wages. He mentioned, "The cost of living is not commensurate with the current market rates. Yet, it is better than evil."

However, labour unions consider this wage to not be a living wage. In a statement, the Garment Workers Trade Union Centre termed the final wage structure "unacceptable," saying that although the workers were returned to work with the assurance of wage revision, the wage board did not set the minimum living wage in the current market in the final wage structure.

Currently, workers' wages increase by 5% annually over their basic pay. The organisation had proposed a 10% increase considering high inflation, which was not accepted.

As a result, the actual wages of workers will fall further every year, the organisation's statement said.

"Garment industry owners get the price of products in the dollar and pay workers in the taka. Without a 10% increment for workers, owners will count additional profit without any investment, and the real wages of workers will continue to decrease," it added.

Babul Akter, general secretary of the Bangladesh Garment and Industrial Workers Federation, told TBS, "With this wage, it will not be possible to run the family of a worker. The aspirations of the workers remained unfulfilled."

However, he urged workers to engage in production without any dissatisfaction on this issue and continue to negotiate with employers.

Towhidur Rahman, former secretary general of the IndustriALL Bangladesh Council, told TBS, "According to the current market rate, it is not possible to live on Tk12,500."

He said, "Requests were made to the government and the wage board from different parts of the world to revise the wages, but the result was nil."

He urged them to start giving rations to workers in December.

On 11 November, the Ministry of Labour and Employment issued a gazette notification announcing Tk12,500 as the minimum monthly wage for the apparel industry.

It also sought opinions, objections, or recommendations from stakeholders or individuals, if any, within 14 days of the publication of the gazette notification. The timeframe ended on Friday.

Local right groups demanded that the minimum wage be raised to Tk23,000 and some factory owners want the amount to be cut to Tk10,400.

Both parties sent letters to the Minimum Wage Board. Until Friday, the Wage Board received more than 200 letters, of which 168 came from garment factory owners, 30 from trade union federations, and one each from Transparency International Bangladesh and Bangladesh Legal Aid and Services Trust.

The new changes in wages

In the meeting, among the five grades, Grade-4 was merged with Grade-3. So, now the final pay is unchanged for Grade-3 but raised for Grade-4, and it has been revised to Tk13,550 which was previously ‍announced as Tk13,025.

Similarly, Grade-2 has been increased from Tk14,150 to Tk14,273 and Grade-1 has been increased from Tk14,750 to Tk15,035.

However, even though the grades were reduced, the demand to keep a wage gap of at least Tk2,000 from one grade to another was not met. The maximum gap is Tk1,050.

BGMEA to monitor buyers' commitment  

A considerable number of foreign brands and buyers have written to the government and owners regarding the wage increase, expressing their commitment to pay more if the wages are raised.

However, this time, the BGMEA will monitor the extent to which these commitments are fulfilled, Faruque Hassan, president of the organisation, told TBS.

Hassan highlighted the challenges in the industry, stating, "Even after making a commitment, most of them, except a few, do not keep it. Maybe reduce orders or create competition between us and take advantage of the benefit. They talk about a living wage, and we want to see if they keep the commitment."

"Already under huge pressure, the Bangladesh Bank has increased the policy rate again. Now, with the increase in wages, the overall cost of production will rise significantly. Despite this, the unit price of our exported garments has been decreasing for the past three months. It will be difficult for us to implement the new wage, but we will implement it," he added.