Why workers repeatedly reject employers’ wage proposals, what will happen this time

The incident took place 13 years ago. In September 2013, employers’ representatives on the Minimum Wage Board proposed increasing the minimum wage by just Tk 600.

Angered by such a small proposed increase, workers across all industrial zones took to the streets in protest. Incidents of vandalism involving factories and vehicles, as well as road blockades, followed.

In Gazipur, workers attacked an Ansar camp, seized four rifles and set them on fire. More than a hundred workers sustained injuries in clashes with the police.

At the time, this Prothom Alo correspondent spoke to many workers taking part in the protests. They said, “On what grounds did the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) propose a Tk 600 wage increase? Our entire salary goes towards paying rent and buying food. No matter how hard we work, we cannot accept such a salary under any circumstances. By proposing a Tk 600 increase, the BGMEA has made a mockery of workers.”

That year, following several consecutive days of protests and demonstrations, employers agreed to raise wages. Ultimately, the Minimum Wage Board set the minimum wage at Tk 5,000.

Following the Rana Plaza collapse, criticism at home and abroad over the low wages of garment workers prompted the government to form a new wage board ahead of schedule.

The situation was not unique to 2013. Similar circumstances emerged again in 2023. On each occasion, employers’ proposals fell far short of workers’ expectations, triggering major protests.

Eventually, following workers’ demonstrations and negotiations, employers agreed to pay higher wages than they had initially proposed.

The government formed the Minimum Wage Board in January 2018 to determine garment workers’ wages. Even before its formation, various workers’ organisations had been campaigning for a minimum wage of Tk 16,000.

However, disregarding the demands of workers’ organisations, the workers’ representative on the wage board proposed a wage of Tk 12,020, drawing criticism. Meanwhile, the employers’ representative sparked controversy by proposing Tk 6,360.

Ultimately, following the intervention of then Prime Minister Sheikh Hasina, the authorities set the minimum wage at Tk 8,000.

On 25 November, the Ministry of Labour issued a gazette notification announcing the new wage structure, which came into effect in December.

Following the publication of the notification, workers at more than a hundred factories first in Narayanganj and later in Gazipur and Ashulia took to the streets in protest. One of the main reasons for the unrest was the wage increase of Tk 2,700 for workers in the lowest, or seventh, grade.

However, workers in the higher grades (grades 3, 4 and 5) had already been earning salaries close to the newly announced rates.

Annual increments of 5 per cent had gradually brought their wages to those levels. As a result, the new wage structure did little to improve the financial circumstances of long-serving workers.

With the national parliamentary election approaching, garment industry owners became concerned about the wage protests. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) held a series of meetings at its office.

Subsequently, industrial police, the Rapid Action Battalion (RAB) and leaders of various workers’ organisations took to the field to contain the labour unrest. After several initiatives from different quarters, the protests eventually came under control.

In the second week of April 2023, the government formed a Minimum Wage Board under the Ministry of Labour.

Although the board held three meetings over the following six months, neither side submitted a proposal. Following criticism over the delay, both workers’ and employers’ representatives submitted their proposals at the fourth meeting, held on 22 October.

The workers’ representative proposed a minimum wage of Tk 20,393. In contrast, the employers’ representative proposed Tk 10,400, almost half that amount.

Workers began protesting the very next day after employers put forward the low proposal. The demonstrations spread across Mirpur, Narayanganj, Savar-Ashulia and Gazipur.

On 30 October, a worker named Russell Hawlader, who sustained injuries during clashes with the police in Gazipur, died. News of his death spread, and a factory was subsequently set on fire. Employers later attempted to bring the situation under control by closing 200 factories.

During the three-week wage protests, three other garment workers – Imran, Jalal Uddin and Anjuara Khatun – also died, in addition to Russell Hawlader. As the situation spiralled out of control, employers decided to submit a revised proposal.

On 7 November, they increased their initial offer by Tk 2,100 and proposed a minimum wage of Tk 12,500. The board eventually finalised that amount, and the new wage structure came into effect on 1 December.

Garment workers have been protesting since last month, demanding higher wages. In response to the workers’ movement, the government formed a Minimum Wage Board on 1 November.

At the board’s second meeting on Monday, the workers’ representative proposed a minimum wage of Tk 32,000. The board will hold its third meeting next Monday, when the employers’ representative is expected to submit a proposal.

Meanwhile, the situation in the industrial zones has improved somewhat since the wage board began its discussions, but it has yet to return to normal. Workers staged protests in the Savar-Ashulia area every day last week, disrupting production at several factories each day.

Gazipur remained relatively calm on all days of the week except on Thursday. Similarly, although labour unrest occurred in Narayanganj on two days during the first week of this month, the situation has remained calm since then.

Employers have yet to finalise their wage proposal. However, according to several sources among employers, they are likely to follow their old strategy when presenting their offer.

In other words, they will begin negotiations by proposing a low wage. As in previous instances, they will highlight the limited financial capacity of small and medium-sized businesses. Meanwhile, workers’ essential living needs are likely to remain largely secondary to the discussion.

At a time of high inflation, if employers ultimately propose a low wage, there will be little reason for surprise if the events of 2013 or 2023 are repeated.