News

On October, 31st 2010 the government of Bangladesh formally announced implementation of the new pay structure and minimum wages for the garment industry. This took effect on November, 1st 2010 and is expected to be included in the November salaries, normally paid at the start of December.

The formal announcement and effective date for this increase has been long awaited since the publication of the draft in August 2010 but is understood to have been delayed due to the number of comments raised by interested parties.

Production workers in the garment sector are graded by skill level and this will give the lowest paid workers an 80% increase bringing the minimum inclusive of all premiums to Tk3,000 per month with similarly scaled increases across all grades. Meanwhile employees (e.g. office and store workers) are also receiving increases ranging from 77%-82%. Details of the previous and new wage structure and grade classifications are given below.

Whilst these may appear to be significant increases it should be remembered that the last government wage review in Bangladesh took place in October 2006 and there have been calls for increases for a number of years with Unions and other stakeholders lobbying for the lowest minimum wage to be increased to at least Tk5,000 per month, while the Asia Floor Wage campaign has calculate the living wage for the area to stand at Tk10,000 per month.

The government has also made it clear that the new wages should be seen as minimums, meaning that reductions cannot be imposed on workers already earning above these levels prior to the announcement. The structure and rates apply to all workers including those working through labour subcontractors and those paid by piece rate.