Tensions have flared between garment owners and labour officials over the future of annual pay rises for workers in the ready-made garment (RMG) sector, with disagreement on whether higher increments would persist beyond 2025.
Labour leaders are of the view that 9% annual increment is what workers are entitled to which also includes an additional 4% agreed upon last year. This is valid until the government decides to revise the rate. On the other hand, industry leaders claim that only for 2025, 9% increment applies which is introduced as a single-time bonus as an answer to last year’s labour unrest.
With garment workers’ annual increment due in January which should be 9% according to labour leaders, factory owners insist that this will get back to 5%.
Earlier, on 9th December 2024, in front of government authorities, owners’ and employees’ representatives decided to increase the yearly raise for garment workers by 4% to 9% overall.
The Labour Ministry then announced a 9% annual increase that would take effect in January 2025 in a gazette notification published in January of this year.
After a wave of labour unrest in the garment industry, the government increased the yearly increment rate by 4%.
The Head of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Mohammad Hatem, stated that 9% yearly increase is only relevant for 2025 when approached.
The BKMEA President’s comment was rejected by Babul Akhter, General Secretary of IndustriALL Bangladesh Council, who said it is incorrect.
He mentioned that during the talks, the owners had suggested an annual raise of 8%, while the workers had wanted 10%. In the presence of government officials, both parties ultimately reached an agreement on 9%. He stated that employees are entitled to the 9% yearly increase until the next review by the government or the pay board, citing the Labour Ministry gazette.
The government changed the minimum pay for entry-level garment workers from Taka 8,000 set in 2018 to Taka 12,500 in 2023, with a yearly increase of 5%.
Bangladesh Employers’ Federation (BEF) President Fazlee Shamim Ehsan echoed the BKMEA’s stance, stating that although the gazette said that the revised minimum wage will remain in effect until further review, it did not indicate how long the 9% increase would last. He continued by saying that the 4% rise was decided upon in light of the significant inflation at the time, which has subsequently decreased. “A 9% annual increment is not justifiable for a single sector,” he stated, cautioning that such an increase may jeopardise sustainability and jobs.
Fazlee Shamim Ehsan stated that the BEF may ask BGMEA and BKMEA to advise their members to return to the 5% increase rate starting next year, citing the drop in exports.
According to a recent Awaj Foundation poll, 65% of garment workers indicated the enhanced annual raise has been implemented, while 13% said they have not received it. 22% were unsure about how it would be implemented.
