Bangladesh’s failure to uphold international labour standards is threatening its export competitiveness, future trade privileges, and progress towards key development goals, experts have warned.

Persistent labour unrest, poor enforcement of workplace rights, and weak union representation are drawing criticism from global buyers and trade partners. This is also diminishing the country’s bargaining power to secure fair prices for exportable goods and weakening its competitiveness.

Without substantial reforms, the country risks losing access to the European Union’s Generalised Scheme of Preferences Plus (GSP+) after its graduation from Least Developed Country (LDC) status.

The experts further warned that Bangladesh’s exports will shrink in developed markets, including the US and EU, if labour rights are not improved in line with international standards. 

This failure would also impede progress towards achieving Sustainable Development Goal (SDG)-8, which promotes the safeguarding of labour rights and the creation of a safe working environment for all. It could also lead to major challenges in employment generation and result in considerable economic losses.

Industry insiders acknowledged that Bangladesh has made some infrastructural improvements in areas such as workplace safety since the Rana Plaza collapse on 24 April 2013, as well as in wages and compliance. 

However, the country continues to face immense pressure from both domestic and international sources, including global brands and developed countries, over unresolved labour rights concerns. As a result, many buyers remain hesitant to pay premium prices for products that ensure fair labour practices.

Export markets set to shrink

The EU’s Corporate Sustainability Due Diligence Directive (CSDDD), which came into force on 25 July 2024, seeks to enhance the protection of human rights – including labour rights – and address environmental standards within both domestic operations and global value chains.

Speaking to the Daily Sun, Dr Mahfuz Kabir, research director of the Bangladesh Institute of International and Strategic Studies (BIISS), said, “Bangladesh is lagging behind in ensuring decent workplaces for all. In addition, the wage structure for workers remains below the poverty line.

“Bangladesh’s exports will shrink in developed countries, including the US and EU, if the country fails to improve labour rights in line with international standards. Moreover, Bangladesh will not qualify to apply for the EU’s GSP+ after LDC graduation,” he added.

In the 2023-24 fiscal year, Bangladesh exported goods worth $44.46 billion, with the garment sector accounting for $36.15 billion of that total.

“As a result, many factories could be forced to shut down, leading to mass unemployment. Bangladesh must formulate an effective plan to address these challenges urgently,” the economist said.

Dr Mahfuz added that while the ready-made garment (RMG) industry has made notable progress in fire safety and labour rights, other sectors are in very poor condition.

“More than 70% of the workforce is engaged in the informal sector. We must gradually focus on this segment to ensure their rights and improve infrastructure. Access to form unions at factory levels should be guaranteed as a first step,” he emphasised.

Struggle for fair wages and trade unions

Khondaker Golam Moazzem, Research Director at the Centre for Policy Dialogue (CPD), stated that there are approximately 140 sub-sectors in Bangladesh, of which only 42 are currently under the National Minimum Wage Board (MWB).

He noted that Bangladesh continues to struggle to ensure fair wages for workers, with the board’s coverage remaining stagnant for an extended period.

“We recommend including sectors currently outside the board’s purview to facilitate the establishment of a national minimum wage,” he suggested.

Abdur Rahman, President of the Bangladesh Labour Rights Council, commented, “We are not allowed to freely form trade unions in factories. Labour unrest often spirals out of control due to the lack of proper worker leadership. If factory owners permitted unionisation, such unrest could be managed more effectively.

“We are unable to negotiate minimum wages effectively due to the absence of strong unions. Currently, the minimum wage for garment workers is Tk12,500,” he added.

Unsafe workplaces undermine SDG progress

The interconnections between workers’ productivity, workplace safety, social dialogue, and working conditions are crucial to a healthy and efficient labour environment, as outlined in SDG-8, said Razequzzaman Ratan, president of the Socialist Labour Front.

“Bangladesh frequently faces labour unrest due to low wages, delayed payments, unpaid overtime, and sudden factory closures. Unsafe working conditions hinder employment generation and impede progress towards achieving the SDGs. If workers are not protected, the SDGs will remain unachievable,” he said.

Razequzzaman further highlighted that low wages prevent workers from accessing education, leading to a lack of skilled labour. Many suffer from malnutrition, and the country is unable to harness its demographic dividend due to these systemic issues.

“Fair wages, decent workplaces, safety provisions, and a pension system are essential for developing a skilled and sustainable workforce,” he added.

Workplace deaths raise alarm

Sekender Ali Mina, executive director of Safety and Rights Society (SRS), revealed that 5,673 workplace deaths occurred across the agriculture, construction, manufacturing, service, and transport sectors in 4,439 incidents between 2015 and 2024.

The non-profit organisation’s data shows annual fatalities of: 373 in 2015, 382 in 2016, 437 in 2017, 593 in 2018, 572 in 2019, 433 in 2020, 538 in 2021, 712 in 2022, 875 in 2023, and 758 in 2024 across both formal and informal sectors.

“These incidents occurred mainly due to inadequate monitoring by relevant authorities and a lack of awareness among employers and workers. Workplace safety procedures have not seen significant improvement in the last decade. Consequently, the country, employers, and workers’ families continue to suffer. The loss of skilled manpower due to workplace deaths is detrimental to national development,” he stated.

International buyers demand more but pay less

International buyers, particularly from the US and EU, are demanding stronger compliance with labour rights – such as wage increases and better working conditions – while simultaneously offering lower prices for goods, industrialists have claimed.

Speaking to the Daily Sun, former director of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Mohiuddin Rubel said, “All buyers and manufacturers want to ensure labour rights, but implementation is very challenging.

“To uphold labour rights, support from international buyers is essential. However, they are unwilling to pay higher prices. Some even offer lower rates,” he questioned the sincerity of buyers in this regard.

Mohiuddin added that labour and compliance costs should be factored into product pricing. “International stakeholders must recognise this. We face pressure from both domestic and international fronts. Nevertheless, the issue of labour rights is a continuous process,” he remarked.

On the issue of trade unions, he noted that the presence of multiple unions within a single factory complicates law enforcement. “A regional or national trade union framework applicable to all sites could be a more effective solution,” he suggested.

Labour judiciary needs strengthening

Advocate AKM Nasim, a member of the Labour Reform Commission (LRC), said the Commission’s work will conclude by the last week of April. Numerous proposals to strengthen labour rights will be submitted to Chief Adviser Professor Muhammad Yunus.

“To ensure labour rights in the country, the labour judiciary must be developed, and the Department of Inspection for Factories and Establishments (DIFE) must be strengthened,” said Nasim, also the former president of the Bangladesh Labour Court Bar Association.

He revealed that around 22,000 lawsuits are currently pending in the country’s labour courts, with many delayed far beyond the stipulated timelines.

“Some cases have been unresolved for years. Alternative Dispute Resolution (ADR) is now essential to resolving these issues efficiently,” he added.

DIFE calls for stricter penalties

At a recent event, Inspector General of the DIFE Omar Md Imrul Mohsin stressed the importance of harmonious coordination between employers and workers for the development of the labour sector.

He emphasised that necessary reforms and enforcement are vital for establishing a welfare state.

The DIFE proposed several amendments to the labour law, including ensuring decent working environments in both formal and informal sectors, increasing compensation for workplace accidents, raising penalties for violations, establishing district-level offices nationwide, and creating multiple Deputy Inspector General offices in labour-intensive areas.

It also recommended forming a labour intelligence agency to address unrest, ensuring wage payments within seven days of each month, and notifying local area inspectors accordingly.

Government pledges inclusive labour reform

At a recent programme, Labour and Employment Adviser Brigadier General (retd) Dr M Sakhawat Hossain reaffirmed the government’s commitment to inclusive labour reforms.

“Global support is now vital to driving sustainable change across labour and other sectors. We must also take effective measures to protect workers’ rights and increase transparency in the labour sector,” he stated.