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Bangladesh Wage Board Finally Makes Recommendation; Gazipur Overrun By Violent Protests

After months of tense disputes often mottled by violence, garment factory workers and factory owners have finally come to a resolution over the minimum wage. A special ad hoc panel convened by the government has decided to increase the minimum wage to about 5,300 takas ($68) per month, a 77 percent increase from the previous benchmark of 3,000 takas ($38).

It’s too early for other side to commence celebrations. The Ministry of Labor still has to approve what only amounts to a non-binding recommendation. Kalpona Akter, the executive director of the Bangladesh Center for Worker Solidarity, a non-governmental activist group that represents workers, has already voiced complaints that the wages will still be the lowest in the world. Also, Atiqul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association, also made clear that his organization has yet to accept the wage increase.

Riots have roiled Gazipur, closing down fifteen factories. Throngs of angry workers have reportedly broken the windows in at least twenty buildings, also vandalizing cars. Apparently, they are demanding a wage hike to at least 8,000 takas (about $103).

Factory owners and union groups have clashed acrimoniously in recent months over the heated issue of wages. Bangladesh convened a meeting of the Minimum Wage Board, comprised of labor union representatives, governmental bureaucrats and factory owner representatives. Arshad Jamal Dipu, speaking on behalf of factory owners, proposed a minimum wage increase of no more than 20 percent, an increase of Tk 600 to Tk 3,600. Dipu said this number was the result of calculating several variables, including the costs of living and daily calorie consumption for workers.

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Dipu’s proposal starkly contrasts with what factory workers have demanded. Sirajul Islam Rony, a labor leader also on the Minimum Wage Board, angrily called Dipu’s calculations “illogical and inhuman.” He recommended a new minimum wage of Tk 8,114 per month, a 170.5% increase from the current level. He said, “I urged the owners to reconsider the proposal as it is too low from our demand.”

The dispute between labor representatives and factory owners has been brewing ever since the Minimum Wage Board was assembled and Prime Minister Sheikh Hasina assured workers their salaries would be increased.

Historically, a wage board assembles every five years to revisit the issue of compensation for workers. Given the ferment surrounding labor conditions in Bangladesh, especially in the still hot contrails of the Rana Plaza tragedy, the government decided it would be prudent to meet earlier than scheduled.

Recently, factory owners have assumed a noticeably more conciliatory posture. Atiqul Islam, head of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said, “We told the unions that we’ll hike wages for all workers as soon as new minimum wages are announced by the government panel. We are also ready to hike wages as much as the panel determines. We will accept even if it is more than 20 per cent. But obviously our hope is that the enhanced wages will be win-win for the industry and the workers.”

But tensions have continued to escalate, crescendoing last week when when the managing director of an apparel company was kidnapped for twelve hours. According to law enforcement authorities, the executive’s captors demanded salary increases and severance payments.