An Overview on the Implication of “Bangladesh Labor Code

2006” in the Tannery Industry of Bangladesh.

An Overview on the Implication of “Bangladesh Labor Code

2006” in the Tannery Industry of Bangladesh.

Prepared for-

Shakil Huda

Professor

IBA, University of Dhaka.

Prepared by-

Sadman Prodhan

Batch- 48D

Roll No-47

Institute of Business Administration

University of Dhaka.

Date- 10th December 2012

December 10, 2012

Shakil Huda

Professor

Institute of Business Administration

University of Dhaka.

Dear Sir

Submission of Term Paper.

I hereby submit the term paper on “An Overview on the implication of

‘Bangladesh Labor Code 2006’in the Tannery industry of Bangladesh”.

During the research of the term paper I understood the importance of the

Labor code in a country like Bangladesh where most of the workers are

uneducated. Most of the labors are unaware about their rights and benefits.

They are ignorant about their health, hygiene, safety and welfare. So I

focused on the comparison of the wages and payments, working hours and

leaves, maternity benefits, employment of adolescent, welfare in Tannery

industries. I hope that my term paper will be helpful for any person who

wants to evaluate the implication of Labor Code 2006 for workers in

Tannery industry.

I will be happy to assist you with any concern regarding this issue. Hoping

for your appreciation-

Sincerely

Sadman Prodhan.

Batch- 48D

Roll- 47.

Executive Summery:

The main purpose of this term paper is to provide an insight view of the

condition of the workers working in one of the major industries of

Bangladesh. The comparison is totally centered on the Bangladesh Labor

code, 2006.

The focus of this report is mainly on the wages and payments, working

hours and leaves, maternity benefits, welfare, employment of adolescent

regarding the Bangladesh Labor Code, 2006. This paper will provide a brief

view of the Labor code as well as its implication and application in different

situation. It will also explain how the workers are deprived of their legal

rights and how the industries consciously violating the Labor code.

The comparative analysis shows that only a few numbers of visited tanneries

covers the majority of the labor code. Most of the companies as well as the

workers are unaware of the labor code and the rights and limitations

provided on the labor code. So the workers are constantly deceived of their

rights in these industries.

The revision on the Bangladesh labor code in 2006 covers a lot of the

common standard issues like environmental condition, health and safety, as

well as wages and working hours. This revision complies with international

standards and ensuring the implication of these codes, our industries will

definitely attract foreign market.

An Overview on the Implication of “The Bangladesh Labor

Code 2006” in the Tannery Industry of Bangladesh.

1. Introduction

1.1 Origin of the Report

As a vital part of the Legal Environment of Business course every student is

required to prepare a term paper on labor law or company law under

Professor Shakil Huda (course Instructor). So the topic that I have chosen for

my term paper is “Study on the Implication of ‘The Bangladesh Labor Code,

2006’ in the Tannery Industry of Bangladesh”.

1.2 Objectives

The objective of this term paper is to serve as a compilation of knowledge

about the implication and violation of labor act in one of the leading

industries of Bangladesh. Another objective of this paper is to understand

the Labor laws related with several issues like wages, working hours, safety,

welfare, health, hygiene etc. It will help the worker to understand their rights

and responsibilities. It will also help the employer to understand their duties

and limitations towards the Labors.

1.3 Scope

This term paper mainly deals with a few tanneries of Bangladesh and will

cover the areas regarding wages and payments, working hours and leaves,

maternity benefits, safety, welfare, health and hygiene, accidents and

compensation etc.

1.4 Methodology

The term paper is based on 4 tanneries located in different areas Hazaribagh

in Dhaka city. The visited tanneries are Apex Tannery Ltd, Dhaka Hides and

Skins Ltd, Karim Leather Company and Samina Tannery. Among them

Apex and Dhaka hide are larger and maintains good profile while Karim and

Samina Tannery are of comparatively low profile. A questionnaire was

developed and depending on that a data were collected through fieldwork.

The primary sources were several leather technologists and a few numbers

of labors. And secondary sources were a number of textbooks, journals,

newspapers and the Labor Code, 2006 itself.

1.5 Limitations

The limitation of the study was that during the visit in tannery it was

difficult to talk with the labors. Only the technologists were available to

collect the required data. Labors were interviewed in lunch time or at

afterward of the official time. The tannery owners wouldn’t let their

employees to talk with outsiders. So the conversation were kept discreet and

I had fewer chance to verify the collected data

2. Implementation and Violation of Labor Code, 2006

2.1 Wages and Payments

Chapter 10 of the Labor code deals with provisions related to payments and

wages of the labor. Wages include the following items as per section 120.

a. Any bonus or additional remuneration payable as per the terms of

employment.

b. Any remuneration payable in respect of holidays, leave or overtime

work.

c. Any remuneration payable under order of any court or any award or

settlement between the parties.

d. Any sum payable under this code or any agreement by reason of

termination of employment whether by way of discharge,

retrenchment, retirement, removal, resignation, dismissal, or

otherwise.

e. Any sum payable due to lay off or suspension.

Section 2, clause 45 also provides information regarding Wages. It stats-

a. The value of any house accommodation, supply of light, water,

medical attendance or other amenity or any other service excluded by

general or special order of government.

b. Any contribution paid by the employer to any pension fund or

provident fund.

c. Any traveling allowance or the value of any traveling concession.

d. Any sum paid to the worker to defray special expenses entailed on

him by the nature of his employment.

But as per different court decision of the court of Bangladesh, the

following are also treated as part of wages of a worker.

a. Any amount payable to worker by the order of the court or the award

of the arbitrator shall be treated as wages.

b. Overtime allowance shall be treated as wages.

c. Compensation on retrenchment shall be treated as wages.

d. Allowance during lay off or temporary termination shall be treated as

wages.

e. Increment shall be treated as wages

f. Compensation at the expiry of the employment by any means like

dismissal, discharge or otherwise shall be treated as wages.

g. Gratuity on discharge or other gratuity shall be treated as wages.

h. House rent allowance shall be treated as wages.

i. Wages during leaves and holidays should be treated as wages.

Reality:

There are two major way of payment in tannery industry. The first one is

‘monthly wages’ and the other one is ‘payment on daily bases’. Monthly

wages are paid in the high profile tanneries like Apex Tannery Ltd,

Dhaka Hides and Skins Ltd where the workers hold a permanent job. But

in the low profile industries like Karim Leather Ltd, Samina Tannery etc

pays their worker in daily basis and their jobs are temporary or

conditional. They actually hire labor for a fixed period through a

contractor. After the end of job the workers are free agents. They can

work on any tannery. The permanent workers are paid about 4000-10000

BDT depending on their skills and experience. On the other hand the

temporary workers get their wages in term of hours. It is about 130-200

BDT per hour.

The permanent workers enjoy the benefits of overtime while the daily

basis workers are deprived of it. They permanent workers are provided

with an overtime of 35-50 BDT for each hour. So for the temporary

workers SECTION- 120 is violated where there is a clear word about

overtime.

The high profile tannery does not deduct any portion of wages for

absenteeism or leave but the majority of the tanneries does not provide

payment on leaves or absences. Which again violate of section 120.

There is a few numbers of tanneries like Samina Tannery which provides

a conditional advance salary which is a very rare case in the tannery

industry. But this benefit of advance salary completely depends on

experience and skill of the worker.

2.2 Working Hours and Leaves

2.2.1 Daily Hours

Chapter 09 of the Labor code deals with provisions related to Working

hours and Leaves. According to section 100-

“No adult worker shall ordinary be required or allowed to work in an

establishment for more than 8 hours in any day.”

2.2.2 Overtime

Provided that subject to provision of section 108 an adult worker may

work in an establishment not exceeding 10 hours in any day. According

to section 108-

1. Where a worker works in an establishment for more than the

prescribed hours in any day or any week under this code, he

shall, in respect of overtime work, be entitled to allowance at

the rate of twice of his basic wages, dearness allowance and ad-

hoc or interim wages, if any.

2. where any worker in establishment is paid on a piece rate basis,

the employer, in consultation with the representatives of the

workers, may, for the purpose of this section, fix time rates as

nearly as possible equivalent to the average rates of earnings of

those workers, and the rates so fixed shall be deemed to be the

ordinary rates of wages of those workers.

3. The government may prescribe the registers to be maintained in

an establishment for the purpose of securing compliance with

the provisions of section.

2.2.3 Weekly Hours

Another section provides the provision about the weekly hours. According to

section 102-

1. No adult worker shall ordinary be required or allowed to work in an

establishment for more than forty eight hours in any week.

2. Subject to the provision of section 108, an adult worker may work for

more than 48 hours (Overtime) in a week.

Provided that the weekly hour should not exceed 60 hours.

2.2.4 Weekly Holidays

According to section 103-

Every worker working in any establishment shall,

a. In case of shops, commercial or industrial establishment, be entitled to

one and half day, and in case of factories and other establishment one

day as weekly holiday.

b. In the case of road transport establishment, be entitled to one day of

twenty four consecutive hours of weekly holiday and no deduction

from his wages is allowed for such leaves.

2.2.5 Annual Leave with Wage

Section 17 of the labor law deals with the provision of annual leave with

wages. The section provides as follows-

1. Each worker who has completed one year of continuous service in a

factory shall be allowed during the subsequent period of twelve

month’ leave with wages for a number of day calculated at the rate of-

a. for adult workers one day for every eighteen days of work performed

by her/him during previous twelve months.

b. For adolescent worker one day for every fifteen days of work

performed by him/her during the previous twelve months.

2. An adult worker should cease to earn any such leave when the leave

due to her/him amounts to forty days and an adolescent worker shall

cease to earn the said leave when the leave due to him/her amounts to

sixty days.

2.2.6 Festival Holidays

Provision of labor law stats that-

1. Every worker shall be entitled to eleven day festival-leave for every

calendar year. The employer shall at the beginning of the year fix the

date of such leaves.

2. The employee may require any worker to work on a festival holiday

provided that two day additional compensatory holidays with full pay

and one alternative holiday should be given to him/her under section

103.

2.2.7 Casual Leave

Section 115 stats that-

Every worker shall be entitled to casual leave with full wages for ten

days in a calendar year; and if such leave is not availed, it will not be

accumulated and carried forward to the succeeding year.

2.2.8 Sick Leave

According to section 116-

1. Every worker other than a newspaper worker shall be entitled to sick

leaves with full wages for a total period of fourteen days in a year.

2. Every newspaper worker shall be entitled to sick leave on half wages

for not less than one-eighteen of the period of service.

3. No such leave shall be allowed unless a registered practitioner

appointed by the employer, and in the absence of such practitioner,

any other registered practitioner certifies on examination that the

concerned worker is sick and needs leaves for such period as

mentioned in the certificate for his treatment.

4. Such leaves shall not be accumulated and carried forward to the

succeeding year.

Reality:

The Labor code, 2006 directly stats that the working hour of a worker shall

be not more than 8 hours. But in reality the working hour of most tanneries

are about 9-11 hours other than a small number of tanneries. These hours are

considered as the working hour not the overtime. On the other hand most of

the tanneries pay only 35-50 BDT per hour for overtime while it directly

violates the provision of section 108 which stats that overtime should be

paid double than the regular wages. Weekly hour of work of a worker is way

higher then the stated one. Weekly Leaves are allowed properly in the

tanneries but during the pick hour of tannery industry which is after Eid-Ul-

Adha does not sufficiently provide weekly holidays. And the fact is that the

workers are not paid according to the provision of labor law during this

period. Weekly leaves and annual leaves are duly provided with wages but

casual leaves and sick leaves do not provide any wages to the worker. Only a

few high profile tanneries like Apex tannery Ltd, Dhaka hides and skins Ltd,

Bay tannery Ltd provides leaves with wages.

So the analysis shows that the provisions of Labor code, 2006 regarding

working hours and leaves in tannery industry need to be revised. There are a

number of violations of sections which require to be brought under justice

and the worker should be trained about their rights regarding working hours

and leaves.

2.3 Maternity Benefits

2.3.1 Maternity Leave

Every women worker has her right to get her maternity benefit. According to

section 46-

1. Every women employed in an establishment shall be entitled to, and

her employer shall be liable for the payment of maternity benefit in

respect of the period of eight weeks immediately following her day of

delivery.

2. No women shall be entitled to such benefits if she has, at the time of

delivery, two or more surviving children, but in the case she shall be

entitled to any leave to which she is otherwise entitled.

Provided that a woman shall not be entitled to such maternity benefit unless

she has worked with the employer for not less than six months immediately

preceding her day of delivery.

2.3.2 Procedure of Payment of Maternity Benefit

Three options are open to the mothers as per section 47 of labor law.

1. The owner shall pay the total benefit payable for the preceding eight

weeks within three days from the submission of the certificate of the

probability of delivery by a registered physician and shall pay the

remaining amount after three working days of the submission of the

proof-of delivery.

2. The owner shall pay the benefits payable for the proceeding eight

weeks including the day of the delivery within three days of the

submission of the proof of delivery and pay the remaining within the

next eight weeks after the proof of delivery submitted.

3. The owner shall pay all the benefit payable within three days from the

submission of the proof of delivery to the owner.

2.3.3 Benefits in case of death of the mother

The person nominated by the mother who died, or in the case where no such

person is nominated, her legal representative, shall be entitled to receive the

benefits as described above. Section 45 stats that-

1. If a women entitled to maternity benefit under this chapter dies on the

day of the delivery or during the period of eight weeks thereafter in

respect of which she is entitled to the maternity benefit, the employer

shall pay the amount of maternity benefit due, if the newly born kid

survives her, to the person who undertakes the care of that child and,

if the child does not survive her, the person nominated by her under

this chapter or, if she has made no so nomination, to her legal

representative

2. If a women dies during the period in respect of which she is entitled to

maternity benefit, but before giving birth to a child, the employer shall

be liable only for the period up to and including the date of her death,

provided that any sum already paid to her in excess of such liability

shall not be recoverable and any amount due at the death of the

women shall be paid to the person nominated by her under this

chapter, or she has made no such nomination, to her legal

representative.

Reality:

In recent years the law regarding the benefit of women and maternal affairs

became very strict and government of Bangladesh is very much aware about

this issue. As a result most of the tanneries strictly follow the labor code

regarding maternity benefits. But still there are many tanneries which does

not recruit permanent worker so it became difficult to make the tannery

owner to pay the benefits of maternity. Though most of the tannery provides

proper maternity leaves and payments but in case of death of the mother

benefit is usually not paid to her representative if she hasn’t nominated

someone for the benefit after death.

So it shows that this sector of labor code is followed properly due to the

strictness of the government. So the government should avoid any kind of

leniency in every sector of labor law to ensure the implementation of labor

code.

2.4 Employment of Adolescent

Before starting this chapter we need to know about the basic difference

between an adolescent and a child.

Child:

Child means a person who has not yet completed his fourteen years of age.

Adolescent:

Adolescent is the person who has completed his/her fourteen years but not

completed eighteen years of age.

2.4.1 Prohibition of Employment of Children and Adolescent

Section 34 of labor law sets a standard for the employment of children and

adolescent. It stats that-

1. No child shall be employed or allowed to work in any occupation or

establishment.

2. No adolescent shall be employed or allowed to work in any

occupation or establishment unless-

a. A certificate of fitness in a prescribed form granted to him by a

registered medical practitioner is in the custody of the employer.

b. He carries, wile at work, a token giving reference to such certificate

3. Nothing in subsection 2 shall apply to the employment of any

adolescent in any occupation or establishment either as an apprentice

or for the purpose of receiving vocational training therein.

4. The government may where it is of opinion that an emergency has

arisen and the public interest is so requires, by notification in the

official gazette, declare the subsection 2 shall not be in operation for

such period as may be specified in the notification.

2.4.2 Certificate of fitness

According to section 37-

1. A registered medical practitioner shall, on the application of

any adolescent or his parent or guardian, or the application of

employer of an establishment, examine such person as to

whether such young person is fit to work in any occupation or

establishment and as ascertain his fitness for work in such

factory

2. A certificate of fitness granted under this section shall be valid

only for the period of twelve months from the date on which it

was issued.

3. Any fee payable for a certificate under this section shall be paid

by the employer and shall not be recoverable from the

adolescent or his/her parents or guardian.

2.4.3 Working hour of Adolescent

Section 41 of labor law deals with the provision related with working hour

of adolescent. The brief version of section 41 stats that-

No adolescent shall be allowed or required to work more than 5 hours

a day and 30 hours a week

No adolescent shall be allowed or required to work between the hours

from 7 pm to 7 am.

In every factory, the work of adolescent shall be limited up to two

shifts and no such shift shall be more than 7 and a half hour.

An adolescent can only be appointed in a single relay and such relay

shall be changed only with the prior approval of the inspector for once

in a month.

2.4.4 Probation of Adolescent in certain works

According to section 39-

No adolescent shall be allowed in any establishment to clean, lubricate or

adjust any part of machinery while that part is in motion, or to work

between fixed and moving parts, of any machinery which is in motion.

Section 42 also stats-

No adolescent shall be employed in any underground or underwater

work.

Reality:

Employment of adolescent is very common phenomena in tannery

industry because they are cheap easy to control and can be manipulated at

any task. So almost every industry employs adolescent. A very few

tannery employs children because tannery work is heavy and child labor

are not so productive in this industry. Though adolescents are employed

in the tannery but they are not provided with their legal rights and

benefits according to labor code. Most adolescent workers work 8-10

hours every day instead of 5 hours. No certification of fitness is required

to get a job in tannery. Sometimes it is found that even they are paid less

than an adult worker though they work as equally as an adult. The

adolescent are also used in all kind of tasks even on those tasks which are

prohibited in labor code. Only the high profile tanneries like Apex, Bay,

Dhaka hides, Bengal leather etc follows the labor code leniently.

So this subject of labor code regarding adolescent shall be revised strictly

by the government. Because most of the codes related with adolescent are

continuously violated in tannery industry.

2.5 Welfare Measures

Chapter 8 of the Bangladesh Labor Code, 2006 deals with the welfare

measures of the workers.

2.5.1 First Aid Appliances

Section 89 of labor code gives heads about first aid appliances. It stats that-

1. There shall, in every establishment be provided and maintained, so as

to be readily accessible during the working hour, first aid boxes and

almirah equipped with the prescribed contents.

2. The number of such boxes and almirah shall not be less than one for

every one hundred and fifty workers ordinarily employed in the

establishment.

3. All such boxes and almirah shall be kept in charge of a responsible

person who is trained in first aid treatment and who shall always be

available during the working hours of the establishment.

4. A notice shall be affixed in every work room stating the name of

person in charge of the box or almirah provided in respect of that

room and such person shall wear a badge so as to facilitate

identification.

5. In every establishment wherein three hundred or more workers are

ordinarily employed, there shall be provided and maintained an

ambulance room or dispensary of the prescribed size containing the

prescribed equipment or similar facilities, in the charge of such

medical and nursing staff as may be prescribed.

2.5.2 Canteens

According to section 92-

1. In any establishment where more than one hundred workers are

ordinarily employed an adequate canteen shall be provided for the use

of the worker.

2. The government may, by rules, provide for-

a. The standards in respect of construction, accommodation, furniture

and other equipments of the canteen.

b. The constitution of a managing committee for the canteen and the

representation of the workers in the management of canteen.

3. The managing committee shall determine the type of foodstuff to be

served therein and the charge therefore.

2.5.3 Shelter, Rest Rooms or Lunch Room

Section 93 of the labor code 2006 makes a provision of a rest room for every

50 or more workers and a separate rest room for the female workers

numbering over 25. But if the number of female worker is below 25 then the

factory management shall manage a curtain in the same rest room to create a

separate resting space for the female workers.

2.5.4 Room for Children

Section 94 deals with the corresponding issue. It briefly stats that for every

forty female workers with children below six years of age there shall be

room for children. The room is required to be of such an area so that it can

provide 600 square cm. of space for each child and the minimum height of

such room shall not be less than 360cm.

Reality:

The welfare measure of workers in tannery industry is very poor. There is

not enough first aid boxes provided for the workers in case of minor

accidents. Very few high profile tanneries like Apex tannery Ltd and Dhaka

Hides and skins Ltd maintains first aid boxes or almirah. There is no such

tannery that contains a canteen or a rest room. The workers have to go

outside for the lunch and in the establishment there is no such place for

resting or recreation. From the discussion above it can be easily understood

that there is no room for children whatsoever.

So form the above discussion it is easily understood that workers are

constantly deprived of their rights and benefits regarding welfare

measurement. So the government should pay extra attention on the

implementation of welfare measurement of the tannery workers

3. Findings at a Glance

Most of the tannery industry workers are illiterate.

They are unaware about their rights and benefits.

Recruitment on a job is not fair and proper.

Job security is almost zero.

Payment of wages is not according to the labor code.

The payment is poor and nominal bonus and increment is served.

No definite working hour. Worker always have to work more.

Overtime facility is not proper.

Casual leave or sick leave does not provide wages.

Maternity benefits are provided according to labor code.

Employment of adolescent is quite high.

Adolescents are used in all kinds of work though there are provisions

about probation on certain tasks.

Adolescents are paid less than adults.

Working hour of adolescent is not maintained at all.

Not enough first aid kit available for accident in the tanneries.

No canteen or rest room facility for the workers.

No room for children of the female workers in the establishment.

4. Conclusion

Tannery industry is one of the leading industries of Bangladesh. A large

portion of the population of this country depends on this industry. Though

this industry violates some of the labor codes but this could be easily

controlled by the strict implication of law enforcement. The Government has

to take this matter seriously and by strict control these problems could be

solved. It also should be kept in mind that Tannery industry plays a vital role

in national export and national economy. So any steps toward this industry

should be careful enough that it does not affect the economic condition of

Bangladesh.