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Employment Relations of Bangladesh - Реферат

BA 402 - Comparative Industrial Relations

Instructor: Lyman A. Hussey

March 2007

Employment Relations of

Bangladesh

by

Roman Walker

Index: Page:

Overview...........................................................3

Labour and Unions..............................................3

Economy...........................................................4

Education System................................................5

Legal System......................................................6

Labour Laws.......................................................7

Tax Structure......................................................8

Treatment of Foreign Nationals...............................9

Grameen Bank...................................................10

Overview:

Bangladesh is a small country, located North-East of India, which surrounds it. Bangladesh borders India in the West, North, and East. It also borders to Burma in the South-East and its South coast is located at the Indian Ocean. Bangladesh is 130,200 km big and has a population of 123,633 million people (2000). The capital of Bangladesh is Dhaka.

The majority of Bangladesh's countryside is lowland at the bottom end of the Ganga and Brahmputra. Mountains can only be found in the East and South-East of the country. The climate is subtropical to tropical Monsun-climate.

98% of the population are Bengals. The other minorities are Bihari and some mountain tribes. Bangladesh is one of the thickest populated countries in the world which can hardly cope with the annual economical and social growth of 3%. The state religion is Islam.1

Labour and Unions:

The labour force in 1998 was estimated at about 64 million workers. 11% of the civilian labour force was employed in the industrial sector, 63% in agriculture, 26% in the service industry in 1996. It is not possible to rely on statistics because of a huge unreported black market. The unemployment rate in 2001 was at about 35%.2

The structure of the labour market and the role of unions in Bangladesh are can be compared to those in other South Asia countries. Bangladesh has three types of labour markets: formal, rural informal, and urban informal. The formal labour market is characterized by a contractual relationship between the employer and the employee and supported by labour laws and regulations that protect workers, such as minimum wages, allowances, and limitations on the employer's ability to fire his workers. The other types of labour markets are not covered by any labour regulations. The informal sector dominates the labour market surface. In 1991, 47,2 % of the labour force were classified as unpaid family workers, 15,4% were self-employed, 13,9% were classified as casual workers (day labourers), and only 11,7% had regular full time wage employment.3

Joining unions is granted by the Bangladesh's constitution, as well as the formation of a union only after a government approval. Still in some cases people are harassed and fired who tried to organize a union. People working in the government civil servants, military, and police are not allowed to join unions with the exception of railway, postal, and telegraph workers. Instead they are allowed to join associations which perform similar functions like the unions. Workers of the EPZ (Export Processing Zone), ruled by the Bangladesh Export Processing Zones Authority, an official organ of the government to promote, attract, and facilitate foreign investment in these zones, primary formed to provide special areas where potential investors would find a congenial investment climate, free from cumbersome procedures4, are not allowed to form unions, although the government promised to relax this restriction in 1997.

Although the size of the formal sector is so small, Bangladesh has a large number of labour unions. In 1992 there were 4065 registered unions with a total membership of 1.648.783, which are only 3% of the labour force. The unions are organized in 700 union federations, which are very active. They entered into agreements with the government in 1984, 1991, and 1992 to raise legislation labour benefits and protections, whereby the government provided a high protection to the domestic industries, like textiles, soap and detergents, iron and steel. There is also a strong resistance to trade liberalization in Bangladesh, mostly from the labour unions.5

There is a strong connection between unions and political parties. Almost all unions are affiliated with a political party. Of course you will also find unions that are militant and do engage in intimidation and vandalism, lost production, and transportation delays causing missed shipping dates for exports. Also battles occur between members of rival unions regularly.6

There are no special regulations in the Bangladesh law to ban discrimination by employer against union members and organizers. Usually private sector employers do not like any union activity and sometimes even work in collaboration with the local police. The Registrar of Trade Unions tries to come against such activities but is often not powerful enough to do anything.7

Economy:

Bangladesh improved its economic sector enormously since its independence in 1971. It is world-famous for his largest and comprehensive garments industry. The first years after Bangladesh's independence the economy was characterized by its large jute industry but were overtook by polypropylene products soon.

The biggest part of the GDP belongs to service sector, followed by the industry and agriculture. Bangladesh's main produced commodities are jute manufacturing, cotton textiles, garments, tea processing, paper newsprint, cement, chemicals, light engineering, sugar, food processing, steel, and fertilizer.

Soon after independence Bangladesh had a peak economic growth of 57%. Later the economic growth decreased to 29% in the Eighties and 24% in the Nineties.

The rising population forced Bangladesh to increase its food outcome. It became the third largest rice producing country in the world. Also wheat production increased in recent years, but nevertheless the country faces serious nutrition risk of 10% to 15% of the population. Bangladesh's agriculture is dependant on the monsoonal cycle and still faces problems in power supply throughout the country, which has large reserves of natural resources like gas, as well as some limited like coal and oil.

Since Bangladesh's independence the country received about $30 billion in aid and loans from foreign donors, including the World Bank, Asian Development Bank, UN Development Programme, the US, Japan, Saudi Arabia, and West European countries. But the poverty level of Bangladesh is still high: 138 million people live beneath the poverty line, which is the highest amount of poverty in South Asia. There is also lack in quality of the social service in the country.

The major problems still remain, although improvements have been made by the government: inefficiency of state-owned enterprises, a rapidly growing labour force that cannot be absorbed by agriculture, inefficient power supply, and slow implementation of economic reforms. Nevertheless, the situation for foreign investors and the liberalization of the capital market changed positively, as well as agreements with foreign companies to export oil and gas, better distribution of cooking gas within Bangladesh, building of pipelines and power stations. Foreign aid also declines, exports rise ($10.5 billion in 2005) and investments increase.

To summarize the current economic situation: The GDP was $275 billion in 2004, the GDP-real growth rate was 5.2% in 2005, GDP-per capita was $2,000 in 2004, and aid-per capita was $10.1 in 2003.

The compositions by sectors of the GDP of 2004 are 20.5% by agriculture, 26.7% by industry, and 52.8% by services. The inflation rate of consumer prices was at 5.8% in 2000. The unemployment rate was at 3.6% in 2002.

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