RMG owners reconsider indefinite factory shutdown

Garment manufacturers have backed away from an initial decision to shut factories in unrest-hit areas indefinitely, opting instead to keep units open on Wednesday and monitor the situation following a government request. 

Leaders of the two major garment industry associations took the decision at a meeting on Tuesday night after the home minister urged factory owners on Monday to keep their units operational.

A BGMEA leader who attended Tuesday night's meeting told The Business Standard that owners hoped a signal from the wage board on announcing a new minimum wage by December would calm the unrest, which began around two weeks ago and intensified this week. Labour leaders appointed to the board also said they would work towards announcing a new minimum wage by December.

BGMEA Vice-President Mijanur Rahman said factory owners would be allowed to shut affected units indefinitely under Section 13(1) of the Labour Act, which entails no wages for workers during the closure, if violence continues or workers refuse to resume production. 

Noting that three of his six factories could not maintain production and most units closed on Monday remained shut on Tuesday, he said owners could not keep paying idle workers for long and added, 'Rather than dying a slow death, it is better to die once and for all'.

According to BGMEA data, more than 300 factories across Mirpur, Gazipur, Mymensingh, Ashulia and Zirabo declared holidays on Tuesday as 6.95 lakh workers left their workplaces. 

Fazlee Shamim Ehsan, Executive President of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) said 25 to 30 mostly large factories employing around 1 lakh workers in Narayanganj were also forced to suspend production on Tuesday after remaining largely operational during the initial phase of the unrest.

Meanwhile, industry sources said several international brands contacted suppliers for updates and a major European buyer's representative met law enforcement officials to assess the situation. 

One of Bangladesh's five largest apparel buyers also asked an exporter on Monday whether the situation was getting out of control and what the government was doing to address it.

According to Shovon Islam, Managing Director and Owner of the Sparrow Group of Industries. While some buyers are reportedly cutting orders by 10 to 15 per cent, others are confirming orders up to 20 per cent below initial commitments and warned that 'they may shift these orders to other countries'. 

Source: The Business Standard