Bangladesh Labor Law (Amendment) Bill 2013 was passed on Monday 15 July 2013 in the National Parliament here in Bangladesh. The new law has seen amendments to a total of 87 sections of the Labor Act 2006. The bill came after a factory building collapse in April which killed more than 1,132 garment workers and sparked debate over labor safety and rights. This caused increasing international pressure boosting the drive to bring forward this much awaited amendment. Tax concessions offered by Western countries and low wages have helped turn Bangladesh’s garment sector into the country’s largest employment generator with annual exports worth $21 billion. Sixty percent of exports go to Europe.
Some extracts of the amendment are provided in this report.
The amendment incorporates some provisions including allowing formation of trade unions without informing the factory owners.
Other provisions including resolution of conflicts over legal financial rights through arbitration, ensuring safety measures for workers at their workplaces, mandatory election for workers’ participation committees and introducing compulsory group insurance policies have also been included in the new law.
Besides, the law also includes provisions for formation of a central fund to improve living standards of workers, depositing a 5.0 per cent net profit of companies with different workers’ welfare and provident funds.
The amendment restricts transfer of trade union members from one factory to another of the same owner after any labor unrest.
Labor and Employment Minister Raziuddin Ahmed Razu moved the bill which was later passed in voice vote.
According to the amendment, employees would no longer need approval from factory owners to form trade unions. Now, workers would just need to apply to the Labor Directorate for authorization. The amendment also allows trade unions to be formed in different administrative wings of a factory, which was not permitted under the existing law.
One woman representative would be included in the trade union executive committee if the factory has 20 per cent women workforce.
Any conflict between the workers and the owners over any legal issues including financial ones will be resolved through arbitration and both the parties can file case at the Labor Court in case of no mutual settlement.
Some ILO conditions have also been included in the law, Mr Shipar said adding both workers and owners can take assistance from experts regarding formation of trade unions. The participation committee should be elected, not selected.
Inspection of a factory has been made mandatory at the time of giving license to any factory or its renewal.
All the exits should be kept lock-free.
To improve the living standards of workers, the government, the buyers and the owners will have to form a central fund for the employed beneficiaries of 100 percent export-oriented industries and wholly foreign-owned companies.
No change can be made in the factory layout plan without the permission of factory inspectors, the amended law states.
If any worker dies after two years in service, the management of the industries will have to pay compensation equivalent to one month’s salary. And, if a worker dies in an accident during service, his relatives will be given a compensation equivalent to 45 days’ salary.
If an owner sacks a worker who has served for more than a year at the factory, he/she will be entitled to 15 days’ salary for every year of service.
A permanent health center would be established if there are 5,000 workers or more who are employed and a welfare officer should be employed and a safety committee to be established in the factories that employ 500 workers or more.
The law has brought outsourcing (subcontracting) under registration to improve management of companies and prevent exploitation of the workers.
Group insurance of the workers has been made mandatory for companies with minimum 100 workers.
The amended bill provides that in case of the death of a worker the employer will realize the insurance claim from the insurance company and handover the money directly to the dependent of the deceased worker.
In case of voluntary retirement or termination with minimum 10 years of service, a worker will be entitled to one month’s basic salary for each year of service. But s/he would get one and half month’s basic salary for each year in case of more than 12 years of service.
There is a provision in the bill to keep consistency between the structural design and outlay of a factory while Welfare Fund will have to be constituted for the workers of the export-oriented companies.
However, these amendments already met with criticism regarding its claim to have maintained international standards.
The chief criticisms that has risen after this amendment can be outlined as follows:
1. There are discriminatory anti-strike provisions in the law favor foreign investors by prohibiting strikes in any establishment during the first three years of operation if it is owned by foreigners or is established in collaboration with foreigners.
2. The amended law also seeks to redirect attention to so-called “Participation Committees” and “Safety Committees,” largely powerless bodies made up of management and workers.
3. The compensation amount being too low to drive any change of attitude from the owners.
Apart from the amendment, criticisms include the fear that Mr. Soheil Rana of Rana Plaza might go unscratched, just like Mr. Delwar Hossain of Tazreen Factory Fire and also the owner of Spectrum Garment collapse. The concern over not solving the labor leader Aminul Islam’s murder case also have continued to be a major criticism and is believed to be among the major barriers to protecting the interest of the workers and ensuring security for their freedom to associate.