An overview on the implication of “Bangladesh labor code 2006” in the tannery industry of Bangladesh.
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  • 1. An Overview on the Implication of “Bangladesh Labor Code 2006” in the Tannery Industry of Bangladesh.
  • 2. An Overview on the Implication of “Bangladesh Labor Code 2006” in the Tannery Industry of Bangladesh. Prepared forShakil Huda Professor IBA, University of Dhaka. Prepared bySadman Prodhan Batch- 48D Roll No-47 Institute of Business Administration University of Dhaka. Date- 10th December 2012
  • 3. 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 appreciationSincerely Sadman Prodhan. Batch- 48D Roll- 47.
  • 4. 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.
  • 5. 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.
  • 6. 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
  • 7. 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 statsa. 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.
  • 8. 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.
  • 9. 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 1081. 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 adhoc 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.
  • 10. 2.2.3 Weekly Hours Another section provides the provision about the weekly hours. According to section 1021. 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 103Every 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 follows1. 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 ofa. 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.
  • 11. 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 that1. 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 thatEvery 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 1161. 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,
  • 12. 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-UlAdha 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.
  • 13. 2.3 Maternity Benefits 2.3.1 Maternity Leave Every women worker has her right to get her maternity benefit. According to section 461. 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.
  • 14. 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 that1. 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.
  • 15. 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 that1. 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 unlessa. 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.
  • 16. 2.4.2 Certificate of fitness According to section 371. 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 39No 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.
  • 17. Section 42 also statsNo 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.
  • 18. 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 that1. 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 921. 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 fora. The standards in respect of construction, accommodation, furniture and other equipments of the canteen.
  • 19. 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
  • 20. 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.
  • 21. 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.