The ready made garments (RMG) sector, the single biggest foreign exchange earner in Bangladesh has come a long way in last two decades. The industry has crossed many hurdles to stay competitive. It has proved many predictions futile and wrong and competes fiercely meven after the abolition of quotas under Multi-Fibre Arrangement (MFA) in the North American market and special market entry to European markets. The credit for that achievement goes primarily to the entrepreneurs and the laborers. But the relationship between these two major contributors has come into question and the industry is under severe pressure because of labor unrest. After the labor unrest of 2006 in several RMG units, the sector sustained a loss to the tune of US$60 million, Khan, S. (2007). The fact remains that trade unionism is virtually absent in the garments sector and when responsible labor movement is not given any chance, the consequence is indiscipline and chaos leading to a situation where the mob takes over. So the notion of the absence of labor unionism in the garments in most of the industries as a reason for widespread violence needs more research to reveal the reasons behind and offer possible policy solutions to the crisis.
Methods of Collecting Data
Face to face conversation with the owner of the garments, workers, labor
- Union leaders and staff
- Content analysis
- Facts and literature review
- Collection of relevant information
- Newspaper review
Sources of Data:
The primary sources
- Primary data have been collected through interview of the owners of garments factories, workers, Labor union leaders and staff
The Secondary sources
- Different books and articles
- Evidence from newspapers
Background of RMG
The export-oriented apparel industry of Bangladesh, popularly known as readymade garment (RMG) or simply the garment industry occupies a unique position in economy of Bangladesh. It is the largest exporting industry, which experienced a phenomenal growth during the last three decades. By taking advantage of cheap labor and quota-based market in the USA and EU under the provision of Multi Fiber Arrangement (MFA) of GATT, it attained a high profile in terms of economic growth of the country. The industry started its modest journey in late 1970s and enjoyed a meteoric rise from 30 enterprises in 1980 increased to 4825 in 20081. Average growth rate of this sector was over 20% per over the last two decades. This single sector alone earns about 80% of yearly foreign exchange of the country. Its contribution to GDP reaches 13% in fiscal year 2009-2010. Since independence, no single sector could accelerate the industrialization process in the country as the RMG sector could do. It has created employment opportunity for about 3.5 million people. Most of them are uneducated and unskilled. About 80% of them are women. To a creditable extent, it has been able to relieve the country from the burden of unemployment and at the same time contribute to the empowerment of women. Thus this sector is playing a vital role in socio-economic development of the country.
But this sector is struggling with a number of problems. Conflict between owners and workers, labor unrest, shortage of gas and electricity, poor infrastructure, poor port facility,lead time complexities, conspiracy of home and abroad, advancing competitors in the quota free international market are some of them which are posing a great threat to its survival. In recent time, labor unrest in the RMG sector has been a matter of serious concern. Almost every day electronic and print media cover news of labor unrest in RMG sector in one place or another across the country. Fixing new minimum wage for the garment workers and issue of implementing the new wage structure have been the prime causes of recent labor unrests across the country. The unrest takes shape of violence and vandalism. The agitated workers come to the street and go storming on vehicles and garment factories. The attacke factory is declared closed; many labor leaders are arrested, many workers lose jobs or suffer from uncertainty; losing interest in the uncertainty, the international buyers cancel their orders and divert to another market. The industry comes to a deadlock situation.
The growth of RMG sector in Bangladesh is amazing one and it has been possible mainly because of hard work of labor-force. Rashid, (2010) observes,“It is a story of success, of winning against all odds. It is a story of a nation, which has vowed to overcome all the barriers with limited resources and immense passion. It is not a story of “Veni Vidi Vici2. Rather, it is a tale of toil, a tale of rising, of starting small and finally finding glory”. But thi glory is being diminished day by day due to labor unrest in this sector. This study is designe to unearth the causes of labor unrest and search the areas where Public-Private Partnership can work to address the problem.
Statement of the Problem
Here are, mainly, four parties involved in apparel industry: government, factory owners, International buyers of finished garments, and workers. Of four parties, the first three are Immense beneficiaries, while workers remain deprived. Government receives a handsome amount of revenue from this sector. Buyers, who get garment products at the cheapest Possible price, make huge profits in international markets. Most of the local factory owners Make adequate money out of this business to build palatial houses in posh area of capital, have their children educated and treated abroad, ride luxury cars, spend holidays at tourist resorts across the world. But garment workers, who make all these profits and benefits possible for other three parties, are to live a sub-standard life for years. The wage they get is low. Very often they do not get their salary, overtime bills and bonus in time. Their recruitment system is hiring and firing as they do not get any appointment letter and at any time they can be dismissed by owners for any reason. Being maltreated by owners and mid- level officers, working long hours in a congested room without sufficient rest, lack of recreational opportunity, nutritious foods, medicine, right to legitimate protest against ruthless exploitations, etc are their daily destiny. They don’t have any access to the decision making process. Factory building collapse, fire accident, stampede render many dead and injured. Nevertheless, if any worker protests against owners or management, he/she is threatened by various types of harassment such as dismissal, arrest or even physical assault by the hired hooligans of owners. There are allegations that a vested group is behind the violence in garments industry. Some Human-right-based NGOs are alleged to instigate the work-force in the name of their rights and privileges without knowing the actual capacity of the owners. Very often, agitating workers are aided by outsiders. Nowhere in the world is labor as cheap as in Bangladesh. It is one of the main factors for flourishing of this sector in Bangladesh. Therefore, foreign conspiracies in instigating labor unrest in garment sector of Bangladesh cannot be ruled out as history records hundreds of wars to capture another market.
At every incidence of labor unrest, police is deployed to disperse agitators .The coercive measures of the forces rather deteriorate the situation. Concerned groups engage themselves in blame game and do not waste time to put their readymade comments. Party in power always takes it as a subversive act of opposition party to destabilize government. Opposition party labels it as a failure of government and demands resignation. Factory owners blame workers and vice-versa. Very often, after some violent unrest, an inquir committee is formed to look into the fact. But the fact is that, hardly people come across the investigation report. After some days people forget the issue and things go on as usual.
Solving labor unrest in the RMG sector requires a collective effort. The root causes of unrest are to be explored. If private sectors (garment factory owners, managers, workers, BGMEA, workers’ association, members of civil society organizations, NGO activists) with their firsthand knowledge and experience work together with the public bodies, solution of this problem is possible.
The recently overall impact of last month’s collapse of Rana Plaza at Savar which left over 750 garment workers killed. The worst-ever building collaps in the history of Bangladesh has already drawn huge local and international attention with severe criticism that the 30-year old industry lacks both safety measures and loopholes in implementation of law and regulations.
“The Savar tragedy is high on the agenda of the meeting to discuss how to regulate the industry, bring it under discipline with both health and building safety measures,” a high official of the Ministry said.The country and the sector are facing a serious image crisis following repeated accidents in the garment industry that earns annually $20 billion foreign currency, he said.
The sector is threatened with loss of the generalised system of preferences (GSP) in the US market after the Tazreen blaze while the European Union last week said it is considering trade action against Bangladesh following the Savar tragedy. Canada, another major market for garment, is also in the process of reviewing its GSP facilities.
The EU is the largest market of Bangladesh- made export-oriented products, he said. The earlier focus was on compliance especially health and occupational safety but now buildings and its structural designs and safety are on the agenda.
The meeting is expected to discuss all the issues related to garment industry including compensation of the Savar victims, rehabilitation of the injured workers, health, workplace and building safety, the GSP issues in US, EU and Canada, regaining image across the world and the Pope’s adverse comment, he added.Earlier, after the Tazreen blaze, the government formed the high-powered cabinet committee comprising 11 Ministers and State Ministers to oversee the apparel sector with a view to resolving different problems.
The committee is headed by Labour and Employment Minister Rajiuddin Ahmed Raju while its other members are Ministers for Textile and Jute, Local Government, Rural Development (LGRD) and Cooperatives, Home Affairs, Industries, Commerce, Foreign Affairs, Shipping, and Disaster Management and Relief. The remaining two members are State Ministers for Labour and Employment and Housing and Public Works.
The possible solution in RMG are:
Minimum wage for the garment workers should be regularized and implemented properly. The labor-force needs to shun the path of violence and vandalism. Rather, they can place their rightful demands to the respective authority. The factory owners can hear and address me the problems of the labor-force. A ‘Grievance Officer’ in all garment factories can be appointed. Incidents of labor unrest need to be investigated taking stakeholders from all concerned sector. Recommendations of investigation report need to be implemented properly. The real defaulters irrespective of their identity and status can be brought under legal provisions. Intelligence agency may work in garment industry area to avert further unrest and take preventive measure. Both public and private sector should work together to solve the problem of labor unrest. Level of mutual trust, communication and cooperation between the two sectors need to be uplifted.
The implementation of above-mentioned recommendations is supposed to help address labor Unrest in the readymade garment industry of Bangladesh. However, a number of issue relating to labor unrest in the garment industry of Bangladesh like industrial policy, labo relations, owner-worker relations, trust between public and private sector and conspiracy deserve further attention.
In respect of production, export, earning foreign exchange, contribution to GDP,employment, investment and business mobilization, RMG sector of Bangladesh has been a flourishing industry. Its importance has crossed geographical boundary of the country. Garment business of many international markets in Europe and North America depends on production of garment factories of Bangladesh. It involves stakeholders from various corners covering public, private and international organizations. Given the fabulous volume of trade of the industry, the increasing trends of labor unrest in the RMG sector has been a matter o serious concern. Solving labor unrest in this sector is nearly impossible by a single agency like government or BGMEA or a civil society organization. Findings from data analysis show that public-private cooperation is the most chosen way of addressing labor unrest in the RMG sector of Bangladesh.
The objectives of this present study are to find out the causes of labor unrest and identify areas where public and private agencies can work to address the issue. The responses of the respondents unfold that irregularities in payment, low wage, mistreatment of the workers by managers/ officers, rumor, absence of trade unionism, conspiracy, non-execution of labor laws, unruly nature of the workers and political intervention are the major causes of labor unrest in the RMG sector of Bangladesh. The causes are to be diagnosed through investigation. Findings of the study suggest that investigating the incidents of labor unrest and following up the recommendations is an important attempt to solve the problem. For investigation, most of the respondents like to assign the task with tripartite committee (a committee formed by taking representatives of factory owners, government and garment workers) which emphasizes the need of cooperation between public and private organizations in this issue.
For a flourishing industry like RMG, maintaining law and order situation in the industrial area is very important. During labor uprising, it was found that unidentified outsiders entered the factory area and participated in violence in the name of workers. To control the situation sometimes law enforcers use to rely on coercive measures and disperse the agitating workers.
However, it often deteriorates the situation. There is another allegation maintained by the garment workers against the law enforcers that latter work in favor of the garment owners and against the workers. To ensure sound law and order situation, co-operation between the conflicting parties is a crying need. The law enforcers, with all impartially can help trace the culprits into book and award exemplary punishment. On the hand, the factory owners, managers and garment workers have to have full support to them, provide genuine information to them and help in time of investigation. To avert further unrest, intelligence agency can work in the garment industry area.
Factory owners and garment workers are two most vital actors in RMG sector. They are complementary to each other. The strength of the factory owners is that they are rich, organized and influential in the society. On the other hand, the huge number and unity of the garment workers are their power. Good relationship between the workers and owners is essential for the production as well as boost of the industry. Majority of the respondents(70%) perceive that there exists a communication gap between the owners and workers of garment factories. ‘Tripartite committee’ is preferred by 48% respondents to bridge the gap between the owners and workers.
Involving labor-force in decision-making process is important in addressing labor unrest in the readymade garment industry. It is perceived by 92% of the respondents. While exploring the causes of labor unrest, it is found that irregularities in payment and low wage rank topamong the causes of labor unrest. When this thesis is taken in hand, it was time for declaring new wage scale for the garment workers. There was tough bargaining between the factory owners and labor-leaders for the fixation of minimum wage. The labor-leaders demanded the minimum wage to be fixed at Tk. 5000 while the factory owners started it with TK. 2000.
After a series of meetings with factory owners, Minimum Wage Board and labor-leaders finally it was settled at TK. 3000. Participation of all stakeholders in the decision-making process really helped settle the dispute. Respondents are of the view that representatives of labor-force should be included in regular meetings inside the factory as well as decision- making process at national level. They are also to be included in various committees with the factory owners and managers. Finally, it can be concluded that public-private cooperation in addressing labor unrest in the RMG sector of Bangladesh can be a viable and effective measure. However, level of mutual trust, communication and co-operation between workers and management of a garment factory as well as public and private sector should be uplifted.
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