Some proposed amendments to the new labour law may fail to protect workers’ rights, especially the option of registering a trade union with only 20 workers, which could create instability in the labour market of Bangladesh.
In addition, oversimplification of the trade union registration process could also discourage Foreign Direct Investment (FDI).
Business leaders made these comments at a press conference organize by the Bangladesh Employers Federation (BEF) on Saturday.
Fazlee Shamim Ehsan, president of BEF and managing director of the Leed Platinum-rated green factory Fatullah Apparels Ltd, said: “We have always given importance to the interests and welfare of the workers. At the same time, ensuring the competitiveness and sustainability of business and industry is also our priority. But some of the amendment proposals have become a cause of serious concern for us. In particular, the opportunity to register a trade union with only 20 workers can create instability in the labour market.”
“If only 20 members form a trade union in a factory with 5,000 workers, it will not represent the entire workforce. Again, if there is a possibility of forming a maximum of five unions, even a maximum of 150 members will constitute five unions against 5,000 workers.”
“In small and medium industries, this will give rise to multiple nominal unions, where the management level may have to face repeated pressure. This may increase conflicts and divisions in the workplace, reduce productivity, and create uncertainty in the industry. Such a situation can inadvertently encourage unfair practices and opportunistic activities, which are extremely detrimental to sound industrial relations.”
The BEF president also explained: “If the new amendments create instability, production may be disrupted, as well as timely order delivery. In this situation, the reality of shrinking export opportunities due to the recent reciprocal tariffs policy of the United States and the new tariff structure may become even more dire. Buyers can easily transfer orders from a risky environment to another country, as a result of which Bangladesh may lose a significant share of its market.
In addition, the over-simplification of the trade union registration process may also discourage Foreign Direct Investment (FDI). Investors always seek a stable, predictable and risk-free business environment. If they think that the industry may repeatedly fall into labour disputes and instability, they will choose alternative investment destinations. This will hamper both the country’s job creation potential and long-term economic growth.”
Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Mohammad Hatem said: “When both the workers and the employers are against such a proposal, then in whose interest is such a change being brought?”
“There is no such pressure in rival countries, Vietnam and India. However, in the case of Bangladesh, an attempt is being made to force the issue. There is only one state-controlled trade union in Vietnam. Even the GM of the industrial factory there is himself the president of the trade union. Still, the rights of the workers are intact,” he gave examples.
Kamran Tanvirur Rahman, president of the Metropolitan Chamber of Commerce and Industry (MCCI), said: “There are currently about 65 million people in the country’s labour market. Of these, 10 million to 12 million workers are in the formal sector. The rest work in the informal sector. However, the existing labour law is mainly limited to protecting the rights of workers in the formal sector.”
Farooq Ahmed, secretary-general MCCI and BEF said: “There was a lack of social dialogue on amending the labour law. In the case of workers’ trade unions, it is more realistic to have one or two effective workers’ organizations than to create multiple weak organizations.”
