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Recent labour unrest in the country's readymade garment (RMG) factories over the issue of minimum wage exposes the flawed wage structure practised in the industry. But RMG sector cannot be singled out as workers in some other sectors are also subjected to similar practices. Being the largest export-oriented industry with around 4.0 million workers, any small unrest in RMG sector draws greater attention than others.
Compared with the living wage, minimum wages in most of the manufacturing sectors are significantly lower. As per the International Labour Organisation (ILO) estimation, monthly living wage for a worker in Dhaka is Tk 16,460 and Tk 13,630 in outskirts of Dhaka which include Narayanganj, Savar and Gazipur. Only tannery industry is giving minimum wage (Tk 12,800) closer to the workers' living wages, as identified in the estimate. Minimum wage in pharmaceuticals industry is Tk 8,050, in RMG industry it is Tk 8,000, and in textile industry Tk 5,710 -- as set by the minimum wage board last year. Number of workers in the pharmaceuticals industry is around 0.18 million, while the number is 1.4 million in the textile sector, according to the Labour Force Survey (LFS) 2016-17.
While the number of workers in different sectors indicates the comparative importance of different sectors in employment generation, it has little to do with wage structure. Supply of labour force, nature of jobs and skill of workers are the key determining factors for fixing wages in different sectors. But these are not sufficient to determine wages without considering cost of living of the workers and the ability to pay by the employers. While cost of living is easy to determine thanks to available data, it is tricky to find the employers' ability and their business' profitability. That's why, government needs to examine all these factors thoroughly before fixing minimum wage structure for any sector.
But setting the minimum wage lower than the living wage reflects that something is wrong with the labour policy. Either some flaw is there in the current labour policy, or the wage setting mechanism is not in line with the policy.
In fact, the country has a written labour policy titled 'National Labour Policy, 2012.' Before being approved and adopted in May 2012, the previous labour policy was formulated in 1980. Thus it took more than three decades to revise and update the country's labour policy. The current labour policy is basically a broad guideline to deal with labour related issues emphasising on labour rights and labour welfare.
Regarding wage fixation, the policy has a brief guideline stressing on 'just wage' and says: "The government will make arrangement for the just wage so that labours and their families can maintain a standard living of life." The policy also outlines steps to determine just wage. These includ setting benchmark of minimum wage and regular review and re-fixation of wages in line with market price.
Thus policy guideline for fixing and revising wages in different sectors is clear and non-ambiguous. What is critical is to follow the guideline. While regular review of wage structure is already there, setting a benchmark of minimum wage or adjusting it with market price is either ineffective or flawed.
Again, the labour policy further stresses on 'decent work' which is a strong agenda of the IL0 and well recognised globally. Decent work means opportunities for productive work, fair income, workplace safety and social protection for families. It also includes workers' freedom of expression and right to participate in decision making process.
In a growing economy like Bangladesh which is struggling to reduce poverty with more job creation, ensuring decent work will take time. Acknowledging it in the labour policy is only the first step. Those who are in white collar jobs are already in decent works and even a large number of pink collar job holders are also modestly enjoying job decency. It is the blue collar jobs where the challenge of decent work is very big. Blue collar workers perform manual labour and typically work with their hands. Though high skilled and well trained blue collar workers enjoy a somewhat decent work environment, majority of semi-skilled and unskilled workers have no idea about decent jobs.
Thus it is not the labour policy but the government and the employers who need to take necessary steps for creating congenial environment for decent work. In Bangladesh, ILO has been working in this regard, and a three-year work programme is already there. The outcome will be visible after 2020.
Some other important aspects of the labour policy are occupational health and safety, social security and industrial relations. While occupational injury and illness is defined as personal injury resulting from a work-related accident, it is the workplace condition that comes into picture as responsible for such accidents. Labour Force Survey (LFS) 2016-17 showed that around 1.9 million workers in the country faced occupational injuries, originated from mild to severe accidents, annually on average. It also showed that around 50 per cent of those who faced injury or illness had lost one or two working days while the rate of not returning to work is below one per cent. The trend indicates that occurrence of severe accidents is quite small in the workplaces; still continuous effort is needed to reduce the risks of all kinds of accidents.
The labour policy rightly mentions about industrial relations, especially healthy activities of trade unions and labour welfare associations. In reality, industrial relations have been deteriorating slowly in many sectors as factory owners are not comfortable with trade union activities. It is also shrinking the space for workers' freedom of expression.
Finally, the declared goal of the labour policy is to 'ensure a productive, non-discriminatory, non-exploitative, decent, safe and healthy work environment for all active citizens by creating investment-friendly environment' and also 'establish workers right and labour dignity in all the areas.'
Thus labour policy makes it clear that no matter where a labourer works, he or she is entitled to obtain a non-discriminatory, decent, safe and healthy working condition. Various samples from RMG and some other sectors, however, show that a large number of workers are yet to enjoy these entitlements due to inadequate implementation of labour laws and high cost of doing business. As a cost cutting measure, factory owners generally prefer not to extend any ancillary facility to the workers.
What follows from the above is that the country's current labour policy is realistic and adequate to deal with the core labour related issues. But it needs to be followed up through respective acts and rules. Trade, investment and industrial policies also need to be synchronised with the labour policy.