Rights experts and labor leaders have highlighted the absence of a legal framework to establish minimum wages for over 85 percent of workers and employees across various sectors in the country saying that the deficiency exacerbated wage discrimination and deprivation in Bangladesh.

They noted that while the government has implemented sector-based minimum wages for 42 industrial sectors nationwide, and set wages for state-owned industries based on National Wage Commission recommendations, over 85 percent of the country’s informal sector workforce remains excluded from any wage regulation.

Although the minimum wages for workers in 42 sectors have been set by the government-formed wage board, the wage amounts vary across the industries.

Recently, the government has incorporated two additional sectors – cement and ceramic – into the formal industrial sector and initiated the process of establishing minimum wages for workers in these sectors.

Labour rights activists believe that the absence of a National Minimum Wage standard renders the existing wage system discriminatory and excludes the majority of the workforce from a legal wage framework.

Against the backdrop, the country will observe May Day today like elsewhere in the world.

According to the Bangladesh Bureau of Statistics, informal employment dominated the labour market, with 85 per cent of the employed population engaged in informal employment.

The Labour Force Survey 2022 showed that the informal employment contribution in urban areas was 13.16 million or 74.8 per cent while in rural regions it was 46.64 million, or 88.2 per cent.

Hence, formal employment accounted for 15.1 per cent comprising 3.4 per cent of females and 21.6 per cent of males. About 20.45 million females make up 98 per cent of the informal workforce in rural regions, compared to 3.57 million, or 89.6 per cent in urban areas, the survey stated.

‘We cannot confine the minimum wage of workers to a labour issue. Rather, it is a social and economic issue, as the minimum wage is considered an attractive policy tool for poverty reduction and social justice,’  Syed Sultan Uddin Ahmed, executive director of the Bangladesh Institute of Labour Studies, said.

He said that Bangladesh should introduce a national minimum wage standard instead of the existing sector-based wage system to ensure a balanced society.

Sultan mentioned that 85 per cent of workers and employees in the country’s informal sector were completely unaware of who determined their wages and how they were determined.

‘After obtaining an MBBS degree, one individual secures a job in a private hospital with a monthly payment of Tk 18,000, while another from the same batch lands a job in a different private hospital with Tk 25,000 as monthly pay. It remains unclear who sets the standard and what role the government plays in ensuring equal opportunities for all,’ he noted.

According to BILS, in 2001, the government took the initiative to introduce TK. 1,200 as the national minimum wage for small and medium industries and Tk 1,350 for major industries.

The BILS document said that industry owners opposed the decision, with one employer taking the matter to the High Court to challenge the validity of the national minimum wage.

The court granted a stay on the government’s decision, citing procedural deficiencies in determining the national minimum wage.

The state minister for labour, Md Nazrul Islam Chowdhury, recently said that his ministry had been working to establish an employment department in the country to create job opportunities and skilled manpower in the country.

After establishing the department, it would work to ensure decent employment in all sectors, he said.

Trade Union Centre general secretary Wajed-ul Islam Khan demanded a permanent wage commission for all the formal and non-formal sectors and termed the existing sector-wise wage determination process discriminatory.

‘We have been demanding a national minimum wage standard for a long time so that no one can deprive workers and employees of a legal minimum wage, but the government is reluctant to address the issue,’ he said.

Due to the lack of a national minimum wage, the majority of workers and employees are not only being deprived of legal wages but also missing social protection, Wajed said.

According to Wajed, informal workers typically receive fewer benefits compared to their counterparts in formal employment.

Citing the discriminatory wage-setting process in the formal sector, he said that while workers in the ready-made garment sector were getting Tk 12,500 as the minimum wage, those in some sectors were receiving Tk 4,500–Tk 6,000 as the lowest wage.

Wajed said that workers in various sectors were receiving wages in various amounts, but inflationary pressure was equally affecting them.

Bangladesh Centre for Workers Solidarity executive director Kalpona Akter said that most of the workers and employees in the informal sector had been forced to work with a ‘painful wage’ amount due to a lack of national minimum standards.

She said that the government had yet to include the country’s domestic workers in the definition of workers, and they were not entitled to any legal protection in their workplaces.

Kalpona, also the president of the Bangladesh Garment and Industrial Workers Federation, said that the government has recently recognised farm workers as ‘workers’ but still, they remain out of wage regulation.

‘It is true that the domestic and agricultural workers in the country have gained strong negotiation power on their own, but legal protection for them has remained absent,’ she explained.

Kalpona urged the government to bring all the sectors under regulation and set a national minimum wage standard for all workers and employees in the manufacturing and service sectors.

A recent study conducted by Karmojibi Nari found that workers in the informal sector were characterised by varying degrees of exclusion, dependency, and vulnerability, resulting in a high number of working poor.

The informal economy thrives in the context of high unemployment, underemployment, poverty, gender inequality, and precarious work, it said.

The study conducted on two major sectors of the informal economy—personal care workers and non-clinical healthcare workers—found that the majority of the workers in these sectors have no employment contracts and there is no minimum wage.