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20 RMG factories closed their units

Authorities of 20 ready-made garment (RMG) factories have closed their units following unable to pay wages to workers under the new wage structure.

20 BD RMG factory closure
Figure: Many factories cannot cope with wage hike, low prices given by buyers, and poor placements.

According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), about 10,685 workers lost their jobs due to the closure. Workers of eight factories received their lawful benefits, while the process is underway to clear the dues and other benefits before the Eid-ul-Fitr.

Moreover, more than 50 garment factories have been found ‘very vulnerable’ to labor unrest over non-payment of wages and other benefits ahead of the Eid, according to the BGMEA and the Department of Inspection for Factories and Establishments (DIFE).

“During the last 17 days, some 14 units were closed down. Closures are taking place, as many factories cannot cope with wage hike, low prices given by buyers, and poor placements,” said Dr Rubana Huq, the BGMEA President.

The owners are unable to pay wages for the month of April. Besides, wages for the month of May and Eid bonus also need to be paid, she further said.

“The industry needs to take into account that we cannot afford to be the cheapest anymore. Our sustainability will depend on careful production planning, immediate reduction of wastage, special focus on efficiency, and price negotiation,” Rubana Huq noted.

According to a government agency report, some 118 garment factories, out of its monitored 2,394 units – located in Dhaka city, Savar, Ashulia, Tongi and Narayanganj, failed to pay wages for the month of March.

Only 36 RMG units, out of the 118, paid wages to workers in April, and the rest 82 might not be able to pay wages, which can create untoward incident ahead of the Eid, it observed.

BGMEA report BD RMG factory closure

The report also identified some factors for probable labor unrest that include absence of fixed festival allowance in garment factories, and not paying wages and allowances (including festival) seven to eight days before the Eid vacation starts.

Besides, not getting Eid holiday timely and as demanded, sudden lay-off or closure of factories in Ramadan or ahead of the Eid, workers’ termination, excessive work at night during Ramadan, and no provision of fixed working hours in the holy month are also among the factors.

The BGMEA chief said more than 100 factories have been kept under close monitoring, in which problems might occur over wage and other payment issues.

“To our understanding, 60 factories have serious issues,” she noted.

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