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University of Information Technology

and Sciences
ASSIGNMENT ON: Trade Union in the Garment Factories in Bangladesh

COURSE:

Industrial Relation

Prepared for Md. Nahin Hossain School of Business, University of Information Technology and Sciences Prepared by

Md. Nadiruzzaman Bhuiyan ID: 09510026

Abstract
The working condition of the workers is not satisfactory in Bangladesh and they suffer from low wage rate and poor safety measures. The labor unions which have been established due this unsatisfactory condition could not improve it either. The research is based on analyzing the current working condition of the labors and also why the labor unions are failing to propose a suitable solution. Both primary research and secondary research was done for the paper. Workers were surveyed through a questionnaire and interviews were taken. From the analysis it is found that the owners are not concern about the work environment and the labor unions are failing due to lack of skill of the union leaders and corruption. The literacy rate of the workers also has an effect, since it is low. The industry as well as the country might suffer if this persists.

Introduction
Bangladesh had entered the RMG industry in the late1970s. It was a prospering sector to invest in and government considering the long team economic benefit of the country as well as the opportunity this sector could create for the country, the government waived many laws including labor laws in favor of the garment factories in order to give the industry a chance to flourish. The entry in the RMG industry was made right after the Liberation War, when the economic development in the country was very slow and it was going through a bad economic phase. According to the Bangladesh Bureau of Statistics (1991), the growth rate of Bangladesh was over 4.75 per cent from 1975-80, which however slowed down considerably to an average of only around 3.8 percent in the 1980s. Both the poor economic condition and the waived labor laws were responsible for creating an unsatisfactory working condition for the workers. The workers were deprived of many privileges, so that the industry could grow at the expense of the workers. Today, the RMG sector accounts for more than 70 percent of the countrys foreign earnings. The industry is in good shape but the workers are still enduring the same treatment as before. The working conditions of many garment factories are still unsatisfactory and sometimes the conditions are life-threatening. As stated by Islam (2005, January 5) The garment workers of Bangladesh may be the most deprived labor force in the world. The minimum wage rate was $25 or Tk.1662 per month previously which currently rose to only Tk.3000 or $45 per month in 2010, whereas the

inflation rate has increases by much more than 80% in the past 5 to 10 years. The workers in the garment industry are deprived from a living wage. So in response to the labor condition, a few labor unions were established, but most of them were related to the political parties, favoring only the workers belonging to that party and the numbers of independent labor unions were very few. The working conditions of the workers are still not improving even after the introduction of the labor union. There is also a concern that labor unions are failing due to corruption as many experts and journalist identified it as the main reason behind the failure of the labor unions. Through this report I hope to identify the reasons why the overall working conditions of the garment factories are not improving.

Background
Early during the Industrialization period it was soon understood, that there will always be conflict of interest between the employers and the blue collar labors. For the industry to flourish the workers interest in certain areas must be overlooked. According to Marx (1867), a German philosopher and economist, Capital is dead labour, that, vampire-like, only lives by sucking living labour, and lives the more, the more labour it suck, he also added that interests of capital and the interests of the wage-labour are diametrically opposed to each other. By capital he meant the government, who owned all the assets, that is the factories, offices, etc of the country according to socialism which was also suggested by Marx (1867) himself. Concisely, an employer will always try to exploit the workers for their own benefit. Soon the workers began to feel that they need unite among themselves to have a better bargaining power to communicate and negotiate their problems with the employers. Thus the idea of a forming a labor union was born. Webb and Webb (1894) had described trade union as a a continuous association of wage earners for the purpose of maintaining or improving the conditions of their working lives. Through a labor union, the labors can bargain and ensure their status, rights, wages and demand. It is a workers

right to be part of a labor union, and depending on their will they may or may not be part of a labor union, as suggested by Crane and Matten (2007). A labor union is formed as per the Trade Unions Act, 1926. According to the act any group on organization whether temporary or permanent formed for the purpose of regulating the relations between workers and employers is a labor union. In Bangladesh forming and joining a labor union is a constitutional right according to the Constitution of Peoples Republic of Bangladesh. Considering the low wage rate and the poor working condition of the employees labor unions where established in response to the working. Most of the unions are limited to the public sector or state-controlled enterprises, but trade unions in the private sector are practically banned. Bangladesh stepped into the RMG industry in the year 1978. Since the labor laws were waived by the government to give the industry a chance to grow, the labors were deprived of many privileges. Now, more than three quarters of Bangladeshs export earnings come from the garment industry, which began attracting foreign investors due to cheap labor and low conversion cost, which is described by Crane and Matten (2007) as the race to the bottom effect. The race to the bottom effect is when foreign investors look for alternatives to reduce their cost by outsourcing it to the developing countries; those developing countries usually have a competitive edge in producing cheap labor and can offer the lowest price. In 2002, the industry exported US$5 billion worth of products. The industry now employs more than 3 million workers, 90% of whom are women. As the industry developed itself and reached its full potential in the following years, the working condition of the labors still remains unsatisfactory. The labors in the garment factories have to work in life-threatening working conditions. They are poorly paid, and are forced to do overtime. Many female workers are denied maternity leave or flexible working hours, where as 85 percent of the workers are women. Though many labor unions are formed in response to these problems, but the improvement of the working conditions for the workers are still elusive. The labor unions are mainly failing due to the labor union leaders, as suggested by Ali and Andaleeb (2008, May 4). They write it has been open secret trade unions leaders are mostly corrupt. They are mostly working for the fulfillment of their personal interest.

The literacy rate of the workers is also adding up to the pressure, since it is considerably poor, the workers are easily manipulated as stated by Syed Hamidul Karim, manager of Arunima Apparels Ltd, a sister concern of Rising Group. He was interviewed regarding the research topic, he said that the labor union leaders use the workers and call for strikes for serving the leaders personal interest; it is use as a weapon to threat the factory owners to comply with the leaders personal demands, this scenario persist in most cases.

HYPOTHESIS There are quite a few labor unions in the garment sector in Bangladesh that are currently working for the welfare of the workers. Among them The National Garment Workers Federation (NGWF), Bangladesh Independent Garment Workers Union Federation (BIGUF) and Bangladesh Garment & Industrial Workers Federation (BGIWF) are the ones that solely concern with the garment industry. The workers are constantly suffering from health hazards due to the poor safety measures, and sometimes they even get killed for the risky structure of the factories. Despite such risk and hard work the labors are mistreated and poorly paid. If the workers try to stand up and protest against this injustice they are fired and blacklisted so that they are not recruited by other factories. A labor union is created so that the workers can negotiate with the employers through their collective bargaining power and improve the working condition. So considering the working condition in Bangladesh, labor unions are very much needed. Though being part of a labor union is a workers right and though it is not at all illegal, many workers are scared of joining a labor union due to fear of losing jobs, being victims of misbehavior in the hands of the employer or getting blacklisted.

In the context of Bangladesh, it is often heard that the factory owners are accusing labor union leaders for creating an aggressive attitude in the workers mind for the leaders personal interest. They also complain that labor unions in garment factories do not collaborate with the workers in many occasions and bargains more than is applicable.

Analysis and Findings


The analysis was done by surveying 30 garment workers. The overall result of the respondents is discussed in this section. Among the 30 interviewee, 18 were women workers and the other 12 were men. The age range of most of the workers, who are surveyed, is within 18-40 years and almost all of them were working in the garment industry for more then 3 years. The employment periods of the workers were the maximum in 5-10 year category. For details please refer to the bar chart in the appendix. Among the workers who were interviewed only 7 workers were member of a labor union, and 3 of them were not a member of a labor union but a labor committee. A labor committee is like a labor union is essence, its sole purpose is to protect the right and to improve the working condition of the workers but they are deprived of some rights that a labor union enjoys. It is a committee consisting of members from both the top management and the workers. Most workers did not give any reasons for being part of a labor union. Most of the workers who were not a member of any form of labor union did not join the labor union mostly because it is of no use and they were also not very interested to join. From their interview it seems they were reluctant to join since most of thought it was quite unnecessary. The difficulties that most workers faced in their work place were delay of payment and unavailability of safety precaution, though many workers complained that the wage scale is inappropriate compared to the work done. The average wage rate is below the standard of a living wage, that is their wage is so low that it is difficult for them to maintain their family life. The workers who rarely faced problems say that most of the problems were unavoidable and bound to happen in any organization. Problems they faces apart from the delay in their payments are mainly disorder in the production systems, which is more related to the efficiency and skill of the labors then the fact that it is regarded as a employers fault. Personality clashes

between the workers themselves or the supervisor is also very common. The more common types of problem that the workers face is difficulty in flexible working hours and leave for personal reasons during peak production period, or when significant number of workers are on leave. Other than these problems, very few workers in the other two categories faced unhealthy working condition and misbehavior by supervisor or employer. Only 2 of the respondent agree with that a labor union can improve the work environment. They think so perhaps because they might have faced or have heard people facing difficult situation where the intervention by a labor union helped to improve the condition.

Eleven of the respondent disagrees and eight people strongly disagree with the fact that a labor union can improve the working condition. They think that labor union leaders only pursue their self interest they have faced situation where the labor union failed to help them. The work environment. The following table will help to understand the attitude of the workers and also relation between the attitude towards labor union and the other two.
Labor Union 0.8000 Union Leader -0.9333 Work Environment 0.8778 Correlation (Labor Union and work -0.8798 Environment) Correlation (Labor Union and union 0.7154 leader) It can be seen from the table that the correlation between the attitude of workers towards labor union and work environment is negative, that is they are strongly negatively correlated. This implies that if the working condition or the work environment which consist of all the factors such as having better safety measure, healthy environment and supporting and understanding employer is satisfactory to the worker than the need for going to or forming a labor union is less. A satisfied worker will not be too willing to join a labor union since it is not necessary for the worker to achieve his

personal interest. On the other hand unsatisfied workers would be willing accept any help they can get from improving their working condition. There is strong positive correlation between the attitude of the workers towards labor union and that of the union leader. It is so because the effectiveness of a union is judged by the efficiency of the union leader, who is representing of the labor union. If the workers perceived that the union leaders are not truthful to their cause, the workers will have a negative attitude towards the leader as well labor union itself. Many experts feel that the workers are manipulated by the union leaders for their own personal interest and they are highly indulged in corruption. The values in the above table are calculated by assigning different values within a scale of -2 to +2 to the different questions in the questionnaire. The questions are grouped together accordingly and the average of the grouped questions is calculated to find the attitude of the workers regarding the different aspects discussed above. For example The question in the questionnaire To what extent do you think a labor union leader collaborates with its members? and Do you think the labor union leaders are acting as a good representative on your behalf? are used to calculate the attitude of the workers towards union leaders. The options scaled with the most positive option being +2 and the negative being -2. The average value of the answers of the both questions is the value to represent the attitude of the workers. The mean of all such values gives the overall attitude of the respondents.

Recommendation
Steps should be taken by the workers, employers and authority to improve the current condition of the labors. The labor unions can be more efficient if all the stakeholders come together to diminish the causes of the failure to improve the working condition of the workers such as corruption and lack of knowledge of the workers and union leaders as well as of the owners. A healthy democracy should be established in the country so that the labor can enjoy their fundamental rights to form any trade union. The workers should be trained so that the cost of related to inefficiency is minimized. The union leaders should be more accountable to the workers. The decisions taken by the union leaders should be made discussed and approved by the workers. There should some kind of regulatory body, so that the workers can take action again the union leaders if they are involved in corruption.

The employers can encourage the workers to discuss their problems directly to them. They can form a committee with members consisting of both workers and higher management officials to discuss different issues relating to their problems. They can have an anonymous reporting system for the labors, so that they present their problems to the authority directly. The foreign buyers have a huge role to play to improve the working conditions of the workers. They should not look for only cheap labors but also quality and pay more to the factories, so that they can maintain a higher wage rate. It would be possible if the developing countries form an association and charge a fair price to the foreign buyers, so that they can pay higher wage to the workers

Conclusion
The unsatisfactory working conditions of the labors still persist due to the exploitation of the workers by both the labor union leaders as well as the employers. The workers are still deprived from their rights and are suffering from low wages and poor safety measures. There is no implication of any law for protecting the rights of the labors in the RMG sector in Bangladesh. Corruption and illiteracy of the workers are the main reasons for the failure of labor unions, since they can be easily manipulated by the union leaders for their own benefit. If the factory owners and government does not take corrective measures to improve the working condition of the workers then the country might lose its most revenue earning sector. Recently, due to the increase in costs including wage rate and constant occurrence of strikes many factories are shutting down or acquired by foreign companies. If this persists in the long the government might fail to earn any revenue from this once profitable sector.