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Course Tittle: Health Economics

Course Code: ECO-324

Date of submission : 15.12.2020

An Assignment On:

Labour dissatisfaction in ready-made Garments:

way to overcome.

Submitted to Submitted by

Laily Akter Onika Jahan Akondi

ID: 17122418

Lecturer Department of Economics Session : 2016-2017

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 Introduction :

The RMG industry has accomplished a remarkable growth since the 1980s.
This industry contributes significantly to the Gross Domestic Product (GDP)
of Bangladesh. It has become the lifeline of Bangladeshi economy creating
opportunities for jobs, income and exports (Kamal, Billah & Hossain, 2012).
RMG industries are labor intensive. It has been giants through its low cost
labor. The labor intensiveness and the cheapest labor cost are considered
as the major contributing factors for the embellishment (Islam & Zahid,
2012). Although Bangladesh is not developed in industry, it has been
enriched in Garment industries in the recent past years. In the field of
Industrialization garment industry is a promising step. It has given the
opportunity of employment to millions of unemployed, especially
innumerable uneducated women of the country. It is making significant
contribution in the field of our export income. The RMG industry has
become one of the life lines of Bangladesh economy, sharing a major part
of the country’s export earnings. The industry started its journey in the late
70’s and since then it continued to play a key role in the growth of the
economy, and has emerged as the largest export earning sector of the
country. This industry has contributed in socioeconomic prospects, creating
a huge number employment opportunities mostly for the poor illiterate
female workforce of the country. Thus, the RMG sector has played a vital
role in empowering women by providing employment.But, Worker
dissatisfaction has been a common phenomenon in the RMG industry of
Bangladesh. Workers are being embroiled in clashes frequently; they call
strikes often to make their demand home. It causes enormous loss to the
owners, cripples the economy and tarnishes the image of the country
abroad. It also makes foreign buyers reluctant to render future orders.
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 Literature review:

Many researchers have investigated the garments industry in Bangladesh.

In this research, labour rights and labour standards, fair labour practices as
well as working conditions have received the greatest attention. In
Bangladesh, working conditions in the RMG sector are often deplorable
(Majumder and Begum, 1999; Shimu, 1999; Mondal, 2000; Partima and
Begum, 2000; Begum, 2001; Absar and Kumar, 2006; SDNP, 2003; BILS,
2003; UNDP, 2003; Kabeer, 2004; ILO-NATLEX, 2005; Muhammad, 2006;
Bansari, 2010 and others). Recruitment policies are highly informal
compared to the western standards. This is mostly due to an abundance of
cheap labour in Bangladesh. The majority of workers in the RMG industry
are unskilled and do not have formal appointments or contracts. They are
therefore vulnerable to losing their jobs at any time. However, fear of losing
their jobs and lack of alternative job opportunities compel workers to
continue in unsatisfactory employment (Bansari, 2010). There is no regular
weekly day off, job security, social security, gratuity or provident fund for
the workers (SDNP, 2003). Absence of rewards, lack of training facilities
and rare compensation are growing worker dissatisfaction (DWP, 2000).
Added to this, garments workers are not given any fringe benefits, including
accommodation allowances, health care, emergency funds, or
transportation (Muhammad, 2006), even though they are legally entitled to
some of these benefits, such as maternity leave. Excessive daily working
hours are one of the most common labour standards problems in
Bangladesh (Absar, 2001). Hours worked in the garments industry are
longer than elsewhere in the manufacturing sector, including the export
manufacturing sector, and workers sometimes work all night to meet
delivery deadlines. Despite international standards proscribing a maximum
of 10 hours’ work per day and 6 days per week, workers in Bangladesh are
allegedly forced to work 14 to 16 hours a day and seven days in a week
(ILO-NATLEX, 2005). Moreover, workers are paid very badly for long hours
(Absar and Kumar, 2006). The wage level in the RMG industry is low for
both males and females, compared with workers in similar categories in
other sectors (Khandker, 2002). According to Kabeer and Mahmud (2004),
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RMG workers are paid the lowest wages in Bangladesh, US$0.15 per hour,
half of that paid to the next lowest, the RMG workers in Nepal who earn
US$0.30. Absar (2001) noted that there is no law providing a national
minimum wage in the Bangladeshi garments industry. Although the
government, garments owners and workers have decided on a salary
structure (see appendix - C), most RMG workers receive the minimum
monthly wage (Repon and Ahamed, 2006). Such low wages compel the
garments workers to live in inhuman conditions. However, payment of
wages in many cases is late or irregular. According to Kumar (2006),
several factories in Bangladesh pay their workers’ wages two months or
more in arrears. Many factories keep one month’s payment of overtime
earnings as security money, which in most instances, the workers do not
get back. While these garments workers’ total monthly take-home pay is
not the lowest in the manufacturing sector, they have to work very long
hours for it; overtime is imposed and in some cases not rewarded, making
the hourly returns to their labour extremely low. Rates of overtime payment
are not fixed. Workers are compensated very badly for these long hours
(Absar, 2001; Kumar, 2006) usually only half as much for overtime work as
for normal hours, unless there are high profits from orders, or high
demands to fill new work orders (Shimu, 1999; Mondal, 2000; Kabeer,
2004). To use the working hours efficiently, some employers set production
targets for the workers. Workers are given a quota to fulfill. When they are
unable to fulfill their quota during work hours, they have to stay behind and
work without pay (Paul-Majumder and Begum, 1999). In a field survey
undertaken by the Bangladesh Institute of Labour Studies (BILS, 2003), 72
respondents (60%) stated that payment of overtime was not regular, 28
respondents (23%) complained that overtime was not paid at all, and only
sixteen respondents (13%) showed satisfaction regarding the payment of
overtime (the remaining 4% remained silent on the matter). Continuous
work schedules, wage penalties, physical and verbal abuse are common.

Literature review shows that no comprehensive work has been done on this
topic. So for fulfilling the research gap the study is conducted.
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 Methodology:
This research seeks to analyse and investigate the current status and
examine the situation of labour in the Bangladesh ready-made garment
sector. An extensive literature survey has been undertaken in order to
review the historical perspective, growth and development of the garments
industry, working conditions and environment, labour standards and labour
rights issues, as well as this lack of Social compliance.

Face to face conversation with owners, workers, foreign and local buyers,
labor leaders, and staff.

a) Sources of Data
1. Primary source
 Interview of owners, workers, foreign and local buyers, labor leaders,
and staff, university teacher, politician and member of civil society.

2. Secondary source

 Different books and articles.

 Evidence from newspaper.
 BGMEA website.

b) Data collection instrument

Questionnaire Data had been collected by questioning owners, workers,

foreign and local buyers, labor leaders, staff, university teacher, politician
and member of civil society.

 Objectives of the study:

To know about the real causes of workers dissatisfaction in RMG

sector of Bangladesh.
To know the duty and responsibilities of labor union.
To know about public opinion towards worker dissatisfaction.
To know about the laws for workers development.
To know the impact of worker dissatisfaction on RMG industry.
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 History of Worker’s Dissatisfaction:

The industrial revolution changed the socioeconomic condition in eighteen
century. But at that time the sorrow of the workers knew no bound. In
nineteen century, the workers demanded the 8-hour work a day. It was very
common to work from 10 to 16 hours. In 1880 the workers agitated for 8-
hour workday without cutting in pay. And they declared the 8- hour workday
without the consent of the employer. The workers carried on their agitation
for the 8-hour workday. In 1884, a group of workers agitated against their
various demand including the 8-hour workday. The workers went out on
strike to gain the demand. More and more workers continued to walk off the
jobs. On May 3, 1886 violence broke out at the McCormick Reaper Works
between police and strikers. On 4th May, 1886, a riot broken out between
police and worker in Hage market area of Chicago city and eight workers
were killed by police shoot.

 Worker Dissatisfaction in rmg Sectors:

Bangladesh is earning 78% of its export earnings from the RMG sector.
From the last part of 2014 to till today there has been labor unrest
consecutively in this sector. Almost 4.2 million workers are working in this
sector. Sometimes the workers came out in the streets of Dhaka city and
damaged vehicles and set fire on the garments factories. It is happening so
violently that many of the roads of the city had to be kept close for quite a
few hours.

 Limitations of the study:

The following limitations were faced during the preparation of this
Assignment;

1) Limited access into factories.

2) Difficulties to communicate with factory workers.
3) Time constraint.
4) Unwillingness of Company owner & other respondent to disclose their
identities.
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 Causes behind labour dissatisfaction in RMG sector in

Bangladesh:
Working hours of Workers
In recent time it is argued that the crisis in the Ready Made Garment
(RMG) sector is not only limited to the wages and allowances of the
workers but also with working hours. Productions and exports of the
factories have been decreased and the price of the apparels is also
decreasing in the international market. The owners of this industry allege
that, the supply of gas and electricity is not continuous, because of which
they are compelled to use generators to keep the production process of the
factories uninterrupted, resulting in the increasing cost of productions. But it
is urgent to reduce the cost of production to comply with the foreign
customer’s demand and the competitive international price. Moreover,
serious and untoward incidents in the form of chaos and confusions are
frequently happened in this sector on the basis of rumors and petty
demands of the workers. Working hour is a very important factor for every
workers life. Textiles & apparels sector is a sector where workers are doing
their work each & every day because it is directly related with physical
production. If working hour is more than production is more. Table 5 shows
50 percent of worker’s working hours is 10 hours although standard
working hour is 8 per day. According to Mohammad Hasan, executive
director of Babylon Group ,workers press on for 12 hours on an average to
earn some extra pay through overtime.  He conducted the study among
7,728 workers of four factories in Savar in March. It showed that Rangpur
and Rajshahi divisions accounted for the two biggest sources of workers:
40 percent and 17 percent respectively . sometimes, They are asked to
work whole months at a time the Factory Act, which stipulates that no
employee should work more than ten days consecutively without a break .
Percentage of Workers as Per Working Hours.
Characteristic Hours Respondents Percentage
s
Working hour 9 30 33.33
10 45 50
11 10 11.11
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12 5 5.55

Income of Workers

Maximum worker doing work 10 hours a day, the situation is improve day
by day due to pressure of complains, Government & International
customers.The most important & highlighted issue for garments worker is
their income. Amidst some of the biggest worker movements and unrest in
the history of Bangladesh in which precious lives have been lost and
hundreds injured, the wage board published the gazette declaring BDT
5300 as the minimum wage for workers (Wage Gazette, 2013). In this
gazette, the distribution is 3,000BDT as basic, 1,200BDT as house rent,
2,50BDT as medical allowance, 200BDT as transport allowance and
650BDT as food allowance under the new minimum wage structure (Wage
Gazette, 2013). In Bangladesh there is huge demand of garment workers.
It has been observed in survey that entry level garments & textile workers
are called helper and their wage is 7000-8000 BDT per month including
overtime and it will continue for months.
Percentage of Workers as per Income.
Characteristics Income per Respondents Percentage
month
Income 7000-8000 21 23

8000-9000 22 24

9000-10000 43 48
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10000-11000 4 4

Maximum about 47.78% workers income is 9000-10000 BDT/month

(Table 6) though it is not sufficient but the situation is continuously
improving (survey, 2015).
So its one the major reason why workers get dissatisfy in RMG
sector in Bangladesh.

Leave and holiday as per the international worker

organization (ILO)
All Bangladeshi workers are entitled to 21 days of paid casual leave and
paid public holiday each year. In Cyprus, 20 working days of leave for
workers on a five- day week and 24 working days of leave for workers on a
six-day week over a period of one year’s employment. Every worker is
entitled to 14 public holidays. In Colombia, workers are entitled to 15
consecutive working days of paid annual leave and every worker is also
entitled to 18 paid public holidays. Cambodian workers are entitled to paid
annual leave of 15 days and 27 paid public holidays. In Brazil, workers are
entitled to 30 days of paid casual leave and paid public holiday each year.
In Belgium, workers are entitled to 30 days of paid casual leave and paid
public holiday each year. In Algeria, workers are entitled to 33 days of paid
casual leave and paid public holiday each year. A survey by Bangladesh
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Institute of Labor Studies (2010) on ready-made garments and construction

industries showed that factories do not provide maternity leave only without
pay. The survey exposed that female workers a survey by Bangladesh
Institute of worker Studies (2010) on ready- made garments and
construction industries showed that factories do not provide maternity leave
for four months and most establishments give maternity leave only without
pay. The survey exposed that female workers many times do not want to
bear child because of fear of losing their job as majority end up being fired
by their employers when they become pregnant, or sent on leave without
pay (BILS, 2010). While the public sector workers are privileged, where
most recently the maternity leave period has been extended to 6 months or
24 weeks, the situation is much worse in the largest manufacturing sector
of the country, the garments sector which is the largest employer of
women.

Physical or sexual harassment by the owners or beneficiaries

The observation made by the gender expert, who presented the keynote
paper at a program held at the BGMEA conference room on December 3,
2014 that sexual violence-free environment is still elusive in the apparel
sector aimed factory compliance focusing more on occupational health and
hazards is indeed important’. ‘The expert also referred to the baseline
survey-2011 of the International Labor Organization, which found 84.7 per
cent of women garment workers and 100 per cent of day workers facing
harassment in their workplaces’. In 2011, a survey jointly conducted by the
Bangladesh Garment Manufacturers and Exporters Association (BGMEA),
the Labor ministry, the United Nations Populated Fund found out that the
incidents of sexual harassment even rape of women in different parts of
Bangladesh was occurred continue due to in the absence of adequate
enforcement of relevant laws and rules. The RMG sector is not free from
this situation. The survey also found out that when any sexual harassment
or rape incident was occurred, the victims were poor or vulnerable group.
About 85% of the workers in RMG are women and unexpectedly they are
poor and vulnerable. In 1976, Dhaka Metropolitan Police Ordinance first
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addressed public sexual harassment directly under the name of ‘eve

teasing’ and it provides imprisonment for a term which may extend to one
year or a fine up to TK 2000 or both. In section 10(2), the law defined
sexual harassment as” if a man with a view to fulfilling his sexual desire
outrages a woman’s modesty or makes erotic gesture such as act of the
man will amount to sexual harassment” This law provides imprisonment for
2 to 7 years and an indefinite amount of fine. But it is not implemented in
RMG sector for women harassment.

Livelihood Conditions of Workers and their Families Accommodation

of workers:

A majority of the workers lack adequate facilities, as they are forced to seek
poor housing conditions. Among the surveyed workers, only 47.8 per cent had
one room to themselves or with family members. In other words, about 52.2
per cent shared a room with non-family members; of which 4.4 per cent
stayed with family. Although the situation appears to have improved in
comparison to the past, owing to rises in income and modest improvements
in accommodation, the overall housing conditions remain precarious. Low
levels of income remain the main cause for workers to share rooms. However,
some single women workers prefer to stay in shared rooms for personal
safety and security.

The survey found that, workers spent about BDT 2,684 per month for
accommodation purposes, and changes in accommodation costs vary
between different locations. Unlike the usual nature of rise of house rent,
workers staying in the same location for longer periods faced higher rises
in house rent, compared to those who stay in the same place for shorter
periods. According to Table 8, accommodation costs have increased by
38 per cent in case of workers who stayed in the same location for over
five years, while it has increased by 22 per cent in case of workers who
stayed for shorter periods in one location. In other words, house-owners
tend to impose more rent on workers who cannot avoid staying in the same
location due to unavoidable circumstances (i.e. 32 per cent of total sample
workers). On the other hand, over 68 per cent of workers could not stay
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in the same location either due to rising costs, or for other reasons.

Changes in Housing Expenditure between 2013 and 2018

Criteria Average House Rent (BDT) Change (%)

2013 2018
Stayed at the same 2025 2788 38
house (38 respondents)
Stayed at different 2119 2588 22
houses (77 respondents)
Source: Authors’ calculation based on Moazzem et al. (2013) and CPD’s 2018 Survey
on RMG Workers’ Livelihood.

As can be seen in above Table, several increments in wages failed to ease

workers’ affordability crisis— they are unable to afford the bare minimum
of necessary facilities on an individual basis. A majority of workers still
use toilets on a shared basis (86 per cent); similarly, 85 per cent use
shared kitchen facilities. Workers are unable to rent a room with the
necessary facilities in order to avoid high accommodation costs. In other
words, a worker’s combined family income does not allow him/her to rent
an independent room/house with all the necessary facilities, which
include a kitchen and a toilet. RMG workers are perhaps better off in this
regard, compared to those working in the informal sector, such as
rickshaw-pullers and day- laborer’s, who have much lower and fluctuating
monthly income levels.

Lack of job security:

Job stability is the decent principle. Job stability increases motivation and
responsibility. At the RMG sector the workers are terminated for tiny
reason. Sometimes the workers are terminated brutally and if the workers
protest they are threatened by different types of harassment such as arrest,
even physical assault by the hired hooligan.
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Building collapse, fire accident

The structure of some RMG industry is not satisfactory. The fear of death
or fatal injury peeps into the mind of workers due to building collapse or fire
accident as like as Rana Plaza, Tazreen Fashion, and Standard Fashion.

Not implementing worker development law

The Industrial Revolution began in Great Britain at eighteen century. That

time working environment was worst. Labor law was inherited in British,
India and Pakistan period. The first labor law was developed in this sub-
continent ‘Worker’s Compensation Act 1923’. The worker got the rights
under ‘Trade Union Act 1926’. ‘Trade Union Act and Industrial Dispute
Settlement Act’ were developed in Pakistan period and these two were
merged into Industrial Relation Ordinance, 1969. Factory Act, Shops and
Establishment Act, Employment of Labor Act were developed in 1965. In
1992 ‘National Labor Law Commission’ was formed. But it’s a matter of
regret that all laws are trapped by the industrialists.

Professional legal support is costly:

Legal advice and legal support is always a costly service not only in
Bangladesh but almost anywhere in the world. Workers income rate are
very poor, their social security scheme are also weak. Working class are
always facing serious problem when they get some problem on their job.
Workers jobs are always on risk. The employers have so much power to
terminate the job of workers. To face the legal court cases professional
lawyer's services they need but their services are very costly. Workers
have no ability to pay for that.

Formulation and implementation of proper labor-law reduces the

grievances of the labor. On the other hand (Itcilo, 2008) refers that
avoidance of labor-management and labor-legislation creates the situation
in which labor unrest takes place.
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For these purpose laborers of readymade garments sectors didn’t get their
own rights overall. As why they become dissatisfy in working field and their
own life.

 Way to overcome:
 Employees have the rights to limits on their work day; make sure
safety workplace, to be paid a minimum wage, to guarantee job
security, to ensure leave entitlement, to provide rewards such as
promotion, incentives training for skill development and benefit
sharing and right to form organization. Therefore, working conditions
should be protected by effective rules and regulations that guarantee
workers’ rights, to ensure a social safety net, useful OHS policies,
suitable building code and effective law is to be considered for the
improvement Social compliance.
 A wage is compensation, usually financial, received by workers in
exchange for their labour. Workers in the Bangladesh RMG sector
often work long hours for unusually low pay, regardless of laws
mandating overtime pay or a minimum wage. However, the
government has formed a wage board to re-fix an acceptable
minimum wage in the backdrop of recent unrest at the RMG units in
the country. Therefore, a moderate wages fixing process is required.
 Hours of work greatly influence production levels. If the hours of work
are unsuitable the workers may be absent or quit. Long working
hours or period without breaks, risks of employees developing
fatigue, as well as muscle and soft tissue injuries, may increase if the
work is uncomfortable or repetitive. Working hours must therefore, so
far as is reasonably practicable, be designed and managed in such a
way so as to minimize the impact of working hours on the health,
safety and welfare of employees. It should be noted that working life
and personal life are inter-related, and both can impact on each
other.so it should be solved.

 The workers of RMG sector reside at much neglected places in

Bangladesh. From the country‟s development perspective,
generation of large number of employment through garment sector is
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no longer regarded sufficient for the development of the poor women

workers unless better livelihood conditions can be assured. Workers‟
livelihood can be improved firstly by providing them with higher level
of wages then their shemter and residence. Government may create
a „Workers‟ Livelihood Improvement Fund‟ to support NGOs who are
engaged in providing various kinds of health, nutrition, medical and
child care support to garment workers.
 There is high degree of pressure on workers to achieve the high
target volumes. Under a pressured working situation to fulfill a high
target everyday for long period may threaten the relation between
workers and mid-level management. The gender comparison of
workers is also changing. This is likely to have important implications
for labour relations in the RMG sector. There is a need for a
continuing dialogue between workers and management, particularly
in view of changing employment composition and their new types of
demands.
 Labor productivity in Bangladesh is very low compared (US$1563) to
other competing countries such as China, Cambodia, India,
Indonesia, and Sri Lanka. The study reveals that labor productivity is
highly correlated to wage; one unit rise in wage was expected to
increase labor productivity by 1.3 units. This signifies the
implementation of the new wage structure. The study revealed that
for increasing labour productivity at the enterprise level, appropriate
training, improvement of compliance situation, diversification of
product mix, provision of entertainment facility, performance
incentives, and good behaviour towards workers are crucial. Although
there is fund allocation for skill development of the RMG workers but
the current scenario to a greater extent does not reflect usage of
those funds appropriately and hence an initiative under a public-
private partnership is essential.

These are some of remedial measures of dissatisfaction of labor in RMG

sector in Bangladesh.
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 Conclusion:
Human resource development in the organizational context is a process by
which employees of an organization are continuously helped in a planned
way to acquire capabilities (knowledge, perspective, attitude, values and
skills) required to perform various tasks or functions associated with their
present or future roles, to develop their general capabilities as individuals
so that they are able to discover and utilize their own inner potential for
their own or organizational development purposes. Bangladesh has made
major strides in its human development index. Add the numbers here – you
mention the HDI numbers in the Abstract, but they need to be discussed
here. Bangladesh has abundant human resources especially women
workers but most of the human resources are unskilled, not trained,
underutilized and not developed at all. It is evident that skilled people are
the most valuable resource, and the development of a country depends on
sustainable development of its human resources. RMG is mainly human
resource especially women intensive industry and they are far behind from
sustainable development in Bangladesh. For sustainable human resource
development, different govt. and non govt. organization as well as
individual has some key responsibilities in recruitment, selection, training &
development of human resources in govt. and non govt. organization.
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 References:
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in the RMG Sector in Bangladesh. Australia: Australian National
University ([email protected]).
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Labour and Management in Development Journal. vol. 2, No. 7.
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made Garment Sector in Bangladesh, Labour and Management in
Development Journal, Vol. 2, No. 7.
4. Bhuiyan, Manir Ibn Hafiz, Labour unrest in the RMG industry, Need
for effective HRM, The Quarterly Wheel, October –December 2010.
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Bangladesh,” The Bangladesh Trade Journal, 1(2), Augus
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READY-MADE GARMENT SECTORTO WHAT EXTEND HR/IR
PRACTICES CAN GROW EXHILARATION OF RMG WORKERS?
International Journal of Business and Management Review
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Bangladesh, National Garments Workers Federation,
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10. Priyo (2010). Present status of workers’ rights at RMG sector,
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11.Recent developments in ‘labor rights’ and ‘safety at workplace’ of

Bangladesh RMG industries, Recent developments in ‘labor rights’ and
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‘safety at workplace’ of Bangladesh RMG industries

(textiletoday.com.bd).