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Bangladesh - Minimum Wages - 2011


LAST UPDATE

7 March 2011

SOURCES

An official English text of the Labour Act 2006 had not been published as at the date of this update. The following information relies on two unofficial English translations. To the fullest extent possible, these have been confirmed as identical.

Other source used

A Handbook on the Bangladesh Labour Act 2006, Bangladesh Employers’ Federation August 2009
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Other source used

Unofficial English Translation of the Bangladesh Labour Act 2006 (XLII of 2006) in Dhar N and Ahmed N, Dhar on Labour and Industrial Laws of Bangladesh, ReMiSi Publishers, Dhaka, 2007
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LEGAL DEFINITIONS

Key definitions are contained in §2 of the Labour Act 2006.

Employee/worker

Worker means any person including an apprentice employed in an establishment or industry, either directly or through a contractor, to do any skilled, unskilled, manual, technical, trade promotional or clerical work for hire or reward whether the terms of employment be expressed or implied, but does not include person employed mainly in a managerial or administrative capacity.
Labour Act 2006 - Unofficial English Translation by Dhar §2(Lxv)

Employer

Employer means any person who employs workers in an establishment and includes:
(a) a heir, successor, assign, guardian or legal representative of such person;
(b) any manager or person responsible for the management and control of the establishment;
(c) in relation to an establishment run by or under the authority of the Government, the authority appointed in this behalf or where no authority is so appointed, the head of the Ministry or Division concerned;
(d) in relation to an establishment run by or on behalf of a local authority, the officer appointed in this behalf or, where no officer is so appointed, the chief executive officer of that authority;
(e) in relation to any other establishment, the owner of such establishment and every director, manager, secretary, agent or other officer or person concerned with the management of the affairs thereof; and
(f) in relation to an esatblishment under the occupation of any person other than the owner, the person in occupation of that establishment or in ultimate control over the affairs of the establishment and the manager or other person concerned with the with the management of the affairs thereof.
Labour Act 2006 - Unofficial English Translation by Dhar §2(xLix)

Wage

Wages means all remuneration, expressed in terms of money or capable of being so expressed, which would, if the terms of employment, expressed or implied, were fulfilled, be payable to a worker in respect of his employment or of work done in such employment, and includes any other additional remuneration of the nature aforesaid which would be so payable, but does not include -
(a) the value of any house accommodation, supply of light, water, medical attendance or other amenity or of any service excluded by general or spcial order of the Government;
(b) any contribution paid by the employer to any pension fund or provident fund;
(c) any traveling allowance or on the value of any travelling concession;
(d) any sum paid to the worker to defray special expenses entitled on him by the naure of his employment.

For the purposes of Chapter X (Wages and Payment), wages also includes:
(a) any bonus or other additional remuneration payable under the terms of employment;
(b) any remuneration payable in respect of overtime work, holiday or leave;
(c) any remuneration payable under any award or settlement between the parties or under order of any Court;
(d) any sum payable under this Act or any agreement by reason of termination of employment whether by way of retrenchment, discharge, removal, resignation, retirement, dismissal or otherwise; and
(e) any sum payable due to lay-off or suspension.
Labour Act 2006 - Unofficial English Translation by BEF §§2(45), 120
Labour Act 2006 - Unofficial English Translation by Dhar §§2(45), 120

Minimum wage

The term minimum wage is not defined by the Labour Act 2006.
Labour Act 2006 - Unofficial English Translation by BEF

MINIMUM WAGE FIXING

The Labour Act 2006 sets a procedure for fixing industry minimum wage rates.
Labour Act 2006 - Unofficial English Translation by BEF Chapter XI

Procedure

Minimum wage rates are declared by the Government on an industry basis following recommendations by the Wages Board, a specialist tripartite board established under Chapter IX of the Labour Act 2006.
Labour Act 2006 - Unofficial English Translation by BEF Chapter IX

Procedure in general

Where, in respect of any industry, the Government is of the opinion that, in view of the prevailing rates of wages of workers engaged in that industry, it is reasonable and necessary to fix the minimum rates of wages for all or any class of workers employed in such industry, it may direct the Wages Board to recommend, after such inquiry as the Wages Board thinks fit, the minimum rates of wages for such workers or class of workers. The Government may form the necessary opinion following an application by the employer or workers or both parties.

The Wages Board shall make its recommendation within a period of 6 months from the direction from the Government.

Upon receipt of a recommendation, the Government may, by notice in the official Gazette, declare the minimum wage rate in accordance with the recommendation or refer it back to the Wages Board for reconsideration with such comments and information as the Government may think fit.

Upon receipt of the reconsidered recommendation by the Wages Board, the Government may declare the minimum rates of wages to be as recommended by the Wages Board, subject to such modifications and exceptions as may be specified in the notification. Unless another date is specified in the notification, the declaration shall take effect on the date of publication of the notice.

The minimum rates of wages declared in accordance with this procedure shall be final and shall not, in any manner, be questioned by any person in any Court or before any authority.
Labour Act 2006 - Unofficial English Translation by BEF §§139, 140

Government decides after tripartite or bipartite body discussions/recommendations

The members of the Minimum Wages Board shall be appointed by the Government and shall include a chairman, one independent member as well as one representative each for the employers and workers and one representative each of employer and workers engaged in the industry concerned.
Labour Act 2006 - Unofficial English Translation by BEF §§138

Criteria

In making its recommendation the Wages Board shall take into consideration cost of living, standard of living, cost of production, productivity, price of products, business capability, economic and social conditions of the country and of the locality concerned and other relevant factors.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Needs of workers and their families

The Wages Board shall take the price of products, and the social conditions of the country and of the locality concerned, into consideration in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Cost of living

The Wages Board shall take the cost of living into consideration in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Level of wages and incomes in the country

The Wages Board shall take the standard of living into consideration in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Economic development

The Wages Board shall take the economic conditions of the country and the locality concerned into consideration in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Productivity

The Wages Board shall take productivity into consideration in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Capacity of employers to pay

The Wages Board shall take the cost of production and business capability into consideration in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Inflation rate

The Wages Board will take the price of products into consideration in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Other provisions

The Wages Board shall take any other relevant factors into account in making its recommendation.
Labour Act 2006 - Unofficial English Translation by BEF §141
Labour Act 2006 - Unofficial English Translation by Dhar §141

Coverage

Minimum wage rates are fixed on an industry basis. The categories of workers excluded from general coverage of the Labour Act 2006 under §1(4) are excluded from the protection of the minimum wage rate fixing procedure.
Labour Act 2006 - Unofficial English Translation by BEF Chapter IX, §1(4)

Scope

Minimum wage rates are to be set on an industry basis and shall be binding on all employers concerned.

The Wage Board may recommend minimum rates of wages for all classes of workers in any grade in that industry and may specify the minimum rates of wage for time-work and piece-work and the minimum time-rates specifically for the workers employed on piece work. It shall indicate whether the minimum rates of wages should be adopted uniformly throughout the country or with such local variations.

The Government may, in its notification of the minimum rates of wages, specify exceptions from the declared rates.
Labour Act 2006 - Unofficial English Translation by BEF §§139(1), 139(3), 139(5), 140(1), 149
Labour Act 2006 - Unofficial English Translation by Dhar §§139(1), 139(3), 139(5), 140(1), 149

Excluded categories

The minimum wage rates procedure does not apply to the categories of workers excluded from the coverage of the Labour Act 2006. Separate provision is made in Chapter IX of the Labour Act 2006 for a wages board and minimum wage rates process specific to newspaper workers.
Labour Act 2006 - Unofficial English Translation by BEF §§1(4), 143-147
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Level

The official current minimum wage rate has not been identified. The government gazettes are published in Bengali and an English translation has not been identified.

Scheduled frequency of adjustment

The minimum rates of wages for any industry may be re-fixed after every five years as may be directed by the Government.

The Wages Board shall review its recommendations if a change in the factors relevant to a recommendation so demand, and recommend to the Government any amendment, modification or revision of the minimum wage rates declared by the Government. However, no recommendation shall be reviewed earlier than one year from the date on which it was made, unless the special circumstances of a case so require, or any later than three years from such date.
Labour Act 2006 - Unofficial English Translation by BEF §§139(6), 142
Labour Act 2006 - Unofficial English Translation by Dhar §§139(6), 142

Enforcement mechanisms

A worker to whom money is due under §149 of the Labour Act 2006 (prohibition on paying less than the minimum wage) may apply to the Labour Court for recovery of the same within one year from the date on which the money became due to the worker.
Labour Act 2006 - Unofficial English Translation by BEF §329

Labour inspection

The Chief Inspector appointed by the Government under §318 has the powers enumerated in §319, and the powers of an Inspector throughout the country. The powers and responsibilities of the Chief Inspector and his delegates include:
(a) making such examinations and enquiries as may be necessary to ascertain whether the provisions of the Labour Code and other rules, regulations, orders and schemes are complied with;
(b) requiring the production of registers, records, notices and other documents kept in pursuance of the Act;
(c) examining any person in any establishment, or whom he has reason to believe to be or have been within the last 2 months employed in any establishment;
(d) requiring explanations from the employer or other person examined; and
(e) exercising such other powers and functions as are conferred by the Act or as may be prescribed.
Labour Act 2006 - Unofficial English Translation by BEF §§318, 319

Fines in national currency for non-respect of legislation

Any employer who pays a worker wages at a rate lower than the minimum wage rate shall be punishable with a fine of up to 5000 Taka (or imprisonment, or both).

The employer will also be ordered to pay the affected worker(s) the difference between the remuneration due and amount paid.
Labour Act 2006 - Unofficial English Translation by BEF §289

Other penalties

Failure to pay workers the minimum wage rate is punishable by imprisonment for up to one year, or by fine or by both imprisonment and fine.
Labour Act 2006 - Unofficial English Translation by BEF §289(1)

Results generated on: 22nd December 2014 at 18:45:51.
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