RMG units not ready for Tk 5,000 minimum wage

Most garment factory owners say they are now not in a position to hike workers' monthly salary to minimum Tk 5,000 from the existing pay of Tk 1662.50.
Many blamed the increasing cost of production and buyers' pressure for low price for their inability to execute the minimum salary in accordance with the workers' demand.
Over the last month, workers of some factories staged several demonstrations to press home their demand for such minimum pay.
MA Mazed, deputy managing director of Iris Fabrics, a compliant factory that bagged BKMEA award recently, also points his finger at some adversaries that stand in the way of full implementation of the minimum wages in line with recommendations from the government formed Wage Board.
These adversaries, as he said, are high bank interest on loans, soaring yarn prices and the low CM ( cutting and making) charges offered by foreign buyers.
"Still, I shall have to follow government rules, as it has already formed a board to announce a minimum salary structure for the garment sector," said Mazed.
He also pointed out that his factory now has to go 30 percent below its production capacity because of the energy crunch, or low supply of gas and power, and workers' low skills.
Meantime, buyers also place less orders, as many fail to ensure timely delivery of apparels. As for example, he said, if the previous order was for 10 lakh pieces, it now declines to seven lakh pieces. "Many small factories may face closure due to sudden price hike of yarn in the local market, followed by a hike in raw cotton prices globally,” he said.
When asked about the minimum wage, Anisur Rahman Sinha, chairman of Opex and Sinha Textile Group, hit hard by the recent labour unrest, suggested a collective efforts by the government, owners, workers' representatives and BGMEA leaders to find a headway in this regard.
"Let's wait for the Wage Board's recommendations,” he said.
Abdus Salam Murshedy, president of Bangladesh Garment Manufacturers and Exporters Association, also points to the present adversaries of the industry. "The delivery in time is an important factor. Now we are overcoming the aftershock of the severest global financial recession, but energy crunch grips us. As a result, the production falls. Also, workers' inefficiency has contributed to such decline in output,” Murshedy said.
Despite all these, workers' salary needs to be hiked, as the prices of basic commodities have gone high in the local markets, he said. “The owners will implement the wage as per the decision of the Wage Board."
Fazlul Hoque, president of Bangladesh Knitwear Manufacturers and Exporters Association, also said the sector is not ready now to make the minimum salary at Tk 5,000, as production cost goes high.
"But, it is also true that the salary of workers should be increased. We should also go in line with the seven payment grades in garment workers' wages," he said.
BGMEA's immediate past president Anwar-ul-Alam Chowdhury Parvez said besides gas and power crisis, the latest yarn price hike in the local market following the price hike of raw cotton in the international market is an additional pressure on garment owners.
"The profit is very marginal now for all of adversaries," he added.
Nazma Akter, president of Sammilito Garment Sramik Federation, said the demand for salary hike is a logical demand, but the workers must not damage factories.
"The workers should not put barricade on streets pushing the people in distress. They can negotiate with owners for realising any demand," she said.
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