Table of Contents

Executive Summary___________________________________________________________2

Industrial Relations in RMG Sector: Bangladesh Perspective___________________3

Aspects of Industrial Relations in RMG Sector as referred in Bangladesh Labour Law 2006_______________________________________________________4 2.1 Unfair Labour Practices on the Part of the Employers..................................................4 2.2 Unfair Labour Practices on the Part of the Workmen...................................................6 2.3 Determination of the Collective Bargaining Agent (CBA).............................................6 2.4 The Right of the Collective Bargaining Agent................................................................8 2.5 Participation Committee_________________________________________________9 2.6 Functions of the Participation Committee__________________________________10 2.7 Meetings of the Participation Committee___________________________________11 2.8 Implementation of the Recommendation of the Participation Committee________11 2.9 Trade Unions__________________________________________________________11 2.10 Application for Registration and Required Documents for Registration_________12 2.11 Industrial Dispute............................................................................................................13 2.12 Raising of Industrial Dispute..........................................................................................13 2.13 Settlement of Industrial Dispute.....................................................................................14 2.14 Strike and Lock Out................................................................................... ....................15

Conclusion........................................................................................................................16
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Executive Summary
The industrial relations system is pre-dominantly confrontational in nature rather than cooperative in Bangladesh. It is characterized by the pre-dominant position of informal economy, fragmented unions, weak labour institutions, lack of enforcement of labour laws and conflictridden employer-employee relations. Although in recent times the rate of unionization has increased in the RMG sector, trade union affiliation is low in Bangladesh compared to many other developing countries. The main reasons for this are the fall in employment in previously highly organized sectors, rise of the service sector and increasing flexible types of employment relationships. Data available indicate fragmentation and contradiction in membership of employers and workers organizations. Moreover, data on membership do not reflect the role these organizations play in political and socio-economic processes and institutions. The promotion of an atmosphere of trust between the social partners and the government is needed to encourage social dialogue. Promotion of social dialogue also requires improving negotiation techniques and knowledge base of trade union leaders and employers in Bangladesh. Therefore, it is particularly important that the necessary socio-economic information should be available and training programme should be imparted for analyzing and using that information. Presence of effective and strong labour institutions e.g., trade unions and employers association is central to social dialogue by offering forums for consultations and negotiations. But in Bangladesh, the ability of unions to represent and defend the interest of workers is constrained by many factors including restrictive regulations, and political division amongst them. The maintenance of a climate of good industrial relations in society depends largely upon the role played by the state as an actor in the industrial relations system because it is the duty of the state to formulate labour laws and policies, to administer them and also to uphold justice so that neither the workers nor the employers suffer. Thus the state acts both as a planner and an administrator in the industrial relations system. The state has to ensure that there is no interference in the bargaining process from any political party, government or the employer. It is evident that any kind of state intervention in industrial disputes may strain the relationship between the workers and employers. But the government intervention in trade union remains a persistent feature of industrial relations system in Bangladesh.

Industrial Relations in RMG Sector: Bangladesh Perspective

The need for development of a harmonious and stable industrial relations (IR) system can hardly be over emphasized. It works as an important underlying factor for ensuring enterprise efficiency, productivity growth, employment creation and enhancing international competitiveness of the domestic economy. For Bangladesh with her current volatile industrial relations system marred by extreme form of violence, militancy and conflicts especially in the readymade garments (RMG) sector, an immediate transition to a peaceful and stable IR regime is of crucial importance for unhindered growth and prosperity. More importantly a proactive industrial relations paradigm is required to win her the race towards middle income status within the next decade. Among the informed circle, a common optimism regarding Bangladesh's opportunity to emerge as a powerhouse of exports of RMG is currently running high. With China's global competitive advantage being gradually eroded due to rising labour costs and wage-push inflationary pressure, a window of opportunity has opened for Bangladesh to gain from China's falling competitive advantage in producing the labour-intensive consumer durables including clothing and apparels. The leading RMG importers, including most top world class fashion and designer groups, are looking at Bangladesh as an alternative source of supply. Such dynamic changes and adjustments in the trade opportunities based on comparative advantages constantly change overtime and must not therefore be missed by Bangladesh. While labour cost, investment climate and trade policies etc. will significantly determine Bangladesh's prospects for emerging as a successful competitor in the shifting competitive advantages, maintaining a peaceful and stable industrial relations atmosphere, particularly in the labour-intensive industries, poses an immediate critical challenge. Across the industrial sectors of Bangladesh, including the RMG sector, the broad industrial relations framework is one of confrontation rather than cooperation. But the need in Bangladesh is now for introduction of a "paradigm shift" in the existing thorny labour-management relations framework which is characterized by mistrust, lack of mutual respect and understanding which result in an atmosphere of adversary where the employers refuse to accept the workers as equal partners in production and the workers consider their employers as enemies. All these develop a relationship of hatred and confrontation among the owners and the workers. While the problems of both sides are those of attitudes and mindsets, behavioural changes are required in the interest of mutual benefits through upholding modern corporate practices, norms and values. Feudal ownership mentality and greed for quick and excessive profiteering on the part of some of the owners and militant behavior of the workers must be avoided to establish a modern participatory and rights-based corporate work culture and a new peaceful social order. In order to cope with the challenges of globalization, a new industrial relations system should emerge, marked by a shift from confrontation to cooperation designed to ensure increased enterprise efficiency, productivity growth and enhance international competitiveness of the Bangladesh
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economy. The industrial relations stakeholders -- the management, the government, and the workers (through their representatives (CBAs) i.e., -- and the institutions (the Department of Labour, Trade Unions) must act together to face the new challenges of internationalization and integration of the Bangladesh economy with the global economy by cultivating mature and effective bilateral as well as tripartite relationships between themselves and adopting an integrated approach towards enterprise growth, employment creation and equitable distribution of the benefits of growth. Most importantly, labour-management relationship has to be given an entirely new dimension where the owners and the workers must be willing to give up the existing "adversarial attitude" and move on to a new course of collective action inspired by mutual respect, trust, and confidence. The enterprise management in particular must look towards the workers as the key productive resource and constantly nurture and upgrade the same through adoption of appropriate human resource development policies and maintaining congenial work atmosphere. In this context, education and training of the workers to enable them to become more productive and receptive to organizational and technological changes is of particular importance. All the stakeholders, i.e., the government, the owners' organizations (BEA) including enterprise management, the collective bargaining agents (CBAs), and the Participation Committees involved in the industrial relations framework, should work jointly to develop close and cooperative bipartite as well as tripartite relationships to uphold a work culture in our industries based on shared prosperity and progress. Speedy and effective implementation of the provisions of the Labour Law 2006, especially with respect to the provisions relating to workers rights and their work environment and also employers prerogatives, may go a long way in this direction.

2 Aspects of Industrial Relations in RMG Sector as referred in Bangladesh Labour Law 2006

2.1

Unfair labour practices on the part of the employers

Provisions of the new labour law: Section 195 of the new labour law, 2006 provides a list of conducts or activities which tantamount to unfair labour practices on the part of the employer. Following are the actions in brief: Imposing any condition in a contract of employment seeking to restrain the right of a person to join a trade union or to continue his membership of a trade union.
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 Refuse to employ or refuse to continue to employ on the ground that a person is, or is not a member or officer of a trade union. Discrimination against any person in regard to any employment, promotion or condition of employment on the ground that such person is or is not the member or officer of trade union. Discharge or dismiss any person on the ground that the person is or is not the member or officer of a specific trade union. Instigating or seeking a person to be the member of a particular trade union. Induce a person to refrain from becoming, or to cease to be a member or officer of a trades union. Compel any officer of the CBA to sign a memorandum of settlement by intimidation or by coercion. Interfere with or in any way influence the balloting provided for the election of the CBA. Recruit any new workman during the currency of a legal strike. Changes in the present law: The new law makes the list of the activities of unfair labour practices longer. In the previous law there were eight different activities which had been termed as unfair labour practices. In the new law, however, there are 12 different activities of the employer that are termed as unfair labour practices. Following are the additional four activities of the employer that can be termed as the unfair labour practices from now on. 1. 2. Willful failure in implementing the recommendation of the participation committee. Failure to respond to any communication made by the CBA as regards to any industrial dispute. Transfer of the President, General Secretary, Organizing Secretary and Treasurer of a trade union. Imposing an illegal lock out and continuance thereof and persuading a person to participate in that.

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2.2

Unfair Labour Practices on the Part of the Workmen

Provisions of the new labour law: Section 196 of the new labour law deals with the provisions of unfair labour practices on the part of the labour. Following activities of the labour constitute the unfair labour practice from the part of the labour: Persuade a workman to join or refrain from joining a trade union during the working hours. Intimidate any person to become or refrain from becoming a member or officer of a trade union. Induce any person to become or refrain from becoming a member or officer of a trade union. Compel or attempt to compel an employer to sign a memorandum of settlement by using intimidation. Compel or attempt to compel any workmen to pay or refrain from paying any subscription towards the fund of the trade union.

Changes in present law: In the previous law there were six activities of the labour that were considered to be unfair labour practices. But the present law extended the purview of unfair labour practices. Following are the addition to the list of unfair labour practices on the part of the workmen: 1. Imposing illegal strike or go slow or persuading thereto. 2. Gherao or blockade on the highway or destruction of the property including transport and vehicles.

2.3

Determination of the Collective Bargaining Agent (CBA)

Provisions of the new labour law: Section 202 of the new labour code deals with the provisions relating to the determination of Collective Bargaining Agent. The Law provides the following procedures:

1. Where there is only one trade union, that trade union shall be treated to be the Collective Bargaining Agent in that establishment. 2. Where there are more than one trade union in an establishment , the Registrar shall take necessary steps to elect the Collective Bargaining Agent, upon the application of any of the trade union having members of more than one third of the total workers employed in the establishment 3. Upon the receipt of the application as above the Registrar shall by notice in writing, communicate all the trade unions as to whether they want to contest for the secret ballot for determination of CBA or not giving a time limit of fifteen days. 4. If a trade union fails to indicate within the time specified in the notice, its desire to be a contestant in the secret ballot, it shall be presumed that it shall not be a contestant in such ballot. 5. Every employer shall(a) On being so required by the Registrar, submit to the Registrar a list of all workers employed in the establishment, excluding those whose period of employment in the establishment is less than three months or who are casual or badly workers. (b) Provide such facilities for verification of the list submitted by him as the Registrar may require. 6. On receipt of the list of workers from the employer, the Registrar shall send a copy of the list to each of the contesting trade unions and shall also affix a copy thereof in a conspicuous place of his office and another copy of the list in a conspicuous place of the establishment. 7. The objection if any, received by the Registrar within the specified time shall be disposed of by him after such enquiry as he deems necessary. 8. The Registrar shall make such amendments, alterations or modifications in the list of workers submitted by the employer as may be required by any decision given by him on objections received under previous sub-section. 9. After amendments, alterations or modifications, if any, made under above sub section or where no objections are received by the Registrar within the specified time, the Registrar shall prepare a list of workers employed in the establishment concerned and send copies thereof to the employer and the contesting trade unions at least four days prior to the date fixed for the poll.
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10. The list prepared under the aforesaid sub section shall be deemed to be the list of voters and every person whose name appears in the list shall be entitled to vote to elect the Collective Bargaining Agent. 11. Every employer shall provide such facilities as are required by the Registrar to conduct the poll. 12. No person shall canvas for vote within a radius of fifty yards of the polling station. 13. For the purpose of the holding secret ballot to determine the CBA the Registrar shall do the following: a. Fix a date and intimate the same to the contesting trade unions and the employer; b. Set the sealed ballot boxes, which are sealed in presence of the representative of each of the contesting trade unions if any one present; c. Conduct the poll in the polling stations where the representative of the contesting trade unions shall have the right to enter; d. Count the votes in presence of the representative of the contesting trade unions if anybody is present; e. Declare the result and the name of the elected Collective Bargaining Agent. 14. Where a registered trade union is declared as the Collective Bargaining Agent as per the above rules, no such application for the determination of the CBA shall be entertained within next two years.

2.4

The Right of the Collective Bargaining Agent

Provisions of the new labour law: The Collective Bargaining Agent in relation to an establishment or group of establishments shall be entitled toi. Undertake collective bargaining with the employer or the employers on matters connected with the employment, non employment or terms of employment.

ii. Represent all or any of the workmen in any proceedings. iii. Give notice of and declare a strike in accordance with provisions of the law.
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iv. Nominate representatives of workmen on any committee, fund constituted as per the provisions of law or agreements. Changes in the present Law: 1. The previous law required a trade union for being a CBA to be consists of at least one third of workers as its member, even if it is the only trade union in the establishment but the new law has made a direct provision that if there remains a single trade union that shall be treated as the Collective Bargaining Agent. 2. The registration of the trade union which acquires less than 10% of vote in a poll for determination of CBA shall stand cancelled forthwith. 3. The new law provides for a right to the Collective Bargaining Agent (CBA), in addition to the right of representation of the workers in proceedings, the right of litigation for and on behalf of the one or all of the workers under this Act.

2.5

Participation Committee

Provisions of the new labour law: Section 205 of the new labour code deals with the provisions of the Participation Committee as follows: 1. The owner of a factory, where more than fifty permanent workers are employed, shall form a Participation Committee as per the rules made by the law in this behalf. 2. That Committee shall be formed in combination of both the workers and employers. 3. The representation of the workers shall not be less than that of the employer 4. Workers in the committee shall be selected on the basis of the selection of the trade unions. 5. All other trade Unions, except for the CBA, shall select their representatives equally; the number of representative of the CBA shall be one member more than the total numbers of representative selected by the other trade unions. 6. The workers representative shall be selected as per the rules where there is no trade union in the organization.

7. Where there is a separate unit in an organization with at least 50 workers employed therein, as per the recommendation of the Participation Committee of the establishment, a unit Participation Committee can be formed there, as per the rules in this behalf. 8. The unit Participation Committee shall be formed with the participation of the workers employed in that unit and the representative of the employers there.

2.6

Functions of the Participation Committee

Provisions of the new labour law: The functions of the Participation Committee shall be to inculcate and develop a sense of belongingness and workers commitment and in particular: To endeavor to promote mutual trust, understanding and co operation between the employer and the workmen; To ensure application of labour laws; To foster a sense of discipline and to improve and maintain safety, occupational health and working condition; To encourage vocational training, workers education, and family welfare training; To adopt measures for improvement of welfare services for the workers and their families; To fulfill production target, reduce production cost, and wastes and raise quality of products. Changes in the present Law: 1. Sub section (5) of the section 205 clearly determines the relation between the number of the representatives from the Collective Bargaining Agent and the other trade unions in the Participation Committee, as per the above sub sections: The number of the representative of the Collective Bargaining Agent = Number of the representative of all the trade unions +1 Previous law didnt mention any such relation between the representatives of the groups.

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2. As regards the function of the participation committee there comes no change in the new law.

2.7

Meetings of the Participation Committee

Provisions of the new labour law: Section 207 deals with procedure of the meetings of the Participation Committee to realize all or any of the functions of the participation committee. As per the section The Participation Committee shall meet at least once in every two months to discuss and exchange views and recommend measures for the performance of the functions under section 206. The proceeding of each such meeting shall be forwarded to the Director of Labour and the Conciliator within seven days of meeting.

2.8

Implementation of the Recommendation of the Participation Committee

Provisions of the new labour law: The employer and the trade union shall take necessary steps to implement the specific recommendation of the Participation Committee within the time specified therein. If the employer or the trade union failed to implement the measures suggested by the Participation Committee it shall forthwith communicate the matter to the respective committee and take every possible steps to implement it as early as possible.

Changes in the new law: Although the meeting procedure is exactly the same as the previous law, it makes a provision of the implementation of the recommendation of the committee within the time period provided by the committee itself. Otherwise, willful negligence will be treated as unfair labour practices.

2.9

Trade Unions

Provisions of the new labour law: Special definition of worker for the purpose of industrial relation:
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For the purpose of the industrial relations the word worker means and includes every worker as defined under section 2(65), and any labour who is laid off, retrenched , discharged or dismissed or otherwise terminated for which an industrial dispute has been arisen. But it doesnt include any security staff like guards and fire fighter or any confidential assistant etc. Trade union and freedom of associations: Section 176 of the new labour code deals with the provisions related to trade union and freedom of association: basically to control the relation between workmen and employer and Workmen and workmen, workers, without distinction whatsoever shall have the right to establish and join the union of their choice subject to the constitution of the respective trade union; basically to control the relation between workmen and employer and employer and employers , employers, without distinction whatsoever shall have the right to establish and join the union of their choice subject to the constitution of the respective association; Employers and the workmen shall have the right to form a federation of their trade union and they can also affiliate that federation with any international federation or confederation of trade unions; The trade unions and the associations of the employers shall have the freedom to adopt constitution as per their choice.

2.10

Application for Registration and Required Documents for Registration

Provisions of the new labour law: Section 177 and 178 deals with the procedure for the registration of the trade unions Section 176 states that any trade union can apply for its registration to the registrar of the trade unions of the respective zone under the signature of the President and Secretary of the respective trade unions. Section 178 of the new labour code provides a list of documents, required, for the registration of the trade unions: The name and head office of the trade unions; The date of formation of the trade union;

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The names, age, occupation and designation of the executive committee members of the union Description of the all subscribed members; The name of the establishment to which it is related and the total number of workers in that establishment; In case of a federation of a trade union the names of the member union and address; Three copies of the constitution of the union and the resolution of the meeting in which the constitution is proposed and accepted; A resolution of the meeting empowering the secretary and president of the ------ for the registration of the union; In case of federation the acceptance letter of the member union to become the member of the proposed federation.

2.11

Industrial Dispute

Provisions of the new labour law: Section 2(62) of the new labour code defines the term Industrial Dispute. As per the section, any distance and different between workers and workers, Workers and employers or employers and employers as regards the employment, non employment or terms of employment of a workers has been termed as an industrial dispute. Then Chapter 14 of the Labour law 2006 deals elaborately with the procedure of raising industrial dispute and settlement thereof. Following are the provisions relating to industrial dispute in the present law.

2.12

Raising of Industrial Dispute

Provisions of the new labour law: No industrial dispute shall be treated to be existent unless it is validly raised by the employers or the Collective Bargaining Agent as per the provisions of the law.

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2.13

Settlement of Industrial Dispute

Provisions of the new labour law: Section 210 of the present law deals the procedure as the following: 1. If at any time any employer or the Collective Bargaining Agent finds any dispute is likely to arise, shall communicate the other party in writing. 2. The recipient of the above mentioned communication shall take initiative to arrange a negotiation within fifteen days of the receipt of the communication. Negotiation The proceedings under the above arrangement between two parties shall be treated as negotiation and if there produce a positive solution to the disputing issues, a settlement deed shall be executed and be sealed and signed by both the parties. And a copy of the settlement deed shall be forwarded to the Government and the Conciliator Conciliation If the above mentioned negotiation fails, then it shall be forwarded to the Conciliator for the process of conciliation. 1. If the dispute is settled through conciliation the Conciliator shall report it to the government along with the settlement deed. 2. The conciliation shall be treated to be failed, if it cannot reach any conclusion even after 30 days of the initiation. Provided it can be extended beyond the period if both the parties agree in writing. 3. If it fails the conciliator shall try to manage the parties in dispute to refer the matter to an arbitrator. 4. If the parties disagree about the Arbitration the conciliator shall issue a certificate that the conciliation has failed. Arbitration When both the parties agree to refer the dispute to an Arbitrator then the matter shall be forwarded by the conciliator to the concerned Arbitrator (chosen by both the parties. 1. An arbitrator shall be a person from the list made and maintain by the government in this regard or any person mutually agreed upon by the parties.
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2. Arbitrator shall make an award within thirty days or within any Period, mutually agreed upon after the matter is received. 3. The Arbitrator shall provide a copy of the award to the parties and to the government as well. 4. No appeal shall lie against the award of the Arbitrator. 5. The award shall be valid for a term not more than two years.

2.14

Strike and Lock Out

Provisions of the new labour law: Section 211 of the new labour code deals with the provisions of the strike and lock out in an industry and other establishment. 1. The party raising the industrial dispute, within a period of fifteen days of the receipt of the certificate of failure from the conciliator shall serve a written notice of Strike or lockout whatever is applicable, and the party also mention the date of commencement of the aforesaid strike or lockout within 7 to 14 days of serving such notice or the party raising the dispute may file a case to the labour court, on the matter. 2. No such notice of strike shall be issued by the CBA unless a secret ballot is held in this behalf under the supervision of the Conciliator and three fourth of the members of the CBA opted for the strike. 3. When the strike or lockout already commence, then any party can go to the labour court for the settlement of dispute 4. The Government can stop any strike or lockout if it continues up to a period of 30 days. Provided the government can stop it before the expiry of the above period, if it thinks expedient for public interest. Changes in the present law: In previous law there was a provision of joint application to the labour court by both parties at any stage of the commencement or before the commencement of the strike or lockout, but in present law this provision has been eliminated.

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Conclusion

Industrial relations system in Bangladesh is characterized by the predominant role played in it by the government. Being the single major employer and manager, the industrial relations policies which it pursues with regard to public sector enterprises, have a decisive effect on the state of industrial relations throughout the country. A number of policy initiatives could strengthen the industrial relations system, namely: - The promotion of industrial federations and the provision of equal footing in the system; recent turmoil in the RMG sector indicates that the garment workers need to be organized for systematic collective bargaining. - To strengthen the institutional capacity of basic unions and industrial federations to deliver effective membership services; more transparent and responsible action by the union leadership is also needed. - Government and all concerned entities should take strong initiative to popularize the concept and benefits of social dialogue among the workers and employers. - Improve implementation of minimum wages fixed by the government in RMG. - Formation of participation committees in all RMG factories should be ensured. - The capacity of the labour institutions should be enhanced for the promotion of collective bargaining. - Data base of existing government agencies on labour relations should be improved. - Labour laws should be amended to bring it consistent with ILO ratified conventions regarding freedom of association and the right to collective bargaining. - Procedures for the recruitment of the members of the labour courts should ensure appropriate qualifications and experience in the labour field; remunerations should match the requested qualifications and relevance of the assignments; the Labour Court should have adequate logistic support in order to strengthen its capacity to dispose of the case as early as possible.

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