Following the fatal factory accidents and labour unrest in Bangladesh, a government-appointed panel recommended raising the minimum wage in garment industry. Legal minimum wage for a Bangladeshi garment worker has been increased by 77 per cent to Tk 5,300 or $68. The tripartite board announced this recently amid opposition of the owners' representative. Unions had demanded the minimum wage, be more than doubled to 8,000 taka a month. A six-member committee of government officials, garment manufacturers and union leaders proposed an increase in the minimum pay to 5,300 taka ($68) a month, from the current 3,000 taka.
The wage board's proposal now heads to Bangladesh's Labor Ministry, which must approve it before an increase takes effect. Mikail Shiper, Bangladesh's secretary of labour said there was room for further discussion between factory owners and factory workers.
Exporters also point out that the taka has gained against the US. Dollar and it is currently trading at 77 to the dollar, up from 84 in January, weakening Bangladesh's competitive advantage compared with rivals such as India, where the rupee has fallen sharply. Bangladesh's largest apparel importer, the EU, has also threatened to revoke its preferential treatment of imports from the country if factory working conditions aren't improved. Factory owners, who oppose the increase, say they can't afford to pay significantly more to workers because western consumers have become accustomed to cheap clothing.