Handout - Working Hours, Wages&Benefits

Bangladesh German Development Cooperation
Social Standards
December 2007
PROGRESS (promotion of social, environmental and production standards in the ready-made garment sector) is a joint program of the Bangladesh
Ministry of Commerce and the German Federal Ministry of Economic Cooperation and Development (BMZ), implemented by GTZ.
Address: House 10 C, Road 90, Gulshan 2, Dhaka 1212, Bangladesh. Tel: +880 2 9887567, Fax: + 88028823099, E-mail: progress@gtz.de,1 Website: www.gtz.de
1 PROGRESS Component on Social and Environmental Compliance, implemented by GFA Consulting Group
Topics Covered
Working hours
Wages & Benefits
Maternity Benefit
Working Hours
Daily Hours: As per section 100 of the

Bangladesh Labour Law 2006, no adult worker
shall ordinarily be required or allowed to work
in excess of ten hours a day (including two
hours of overtime).
Weekly Hours: As per section 102 of the

Bangladesh Labour Law 2006, no adult worker
shall be ordinarily required or allowed to work
in an establishment for more than sixty hours
per week (including overtime hours) and on
average no more than fifty six hours per week
(including overtime hours) in any year.
Working Hours
Maximum working hours
Daily Weekly
General Hours 08 48
Overtime 02 12
Hours
Total Hours 10 60
Working Hours
Weekly holiday
Weekly Holiday: As per section 103 of the

Bangladesh Labour Law 2006, a worker
shall be allowed in each week one day as
weekly holiday.
Compensatory weekly holiday: As per

section 104 of the Bangladesh Labour Law
2006, a worker shall be allowed as soon as
circumstances permit, compensatory
holiday if s/he is deprived of any weekly
holiday.
Working Hours
Interval for rest or meal
Interval for rest or meal: As per section 101 of

the Bangladesh Labour Law 2006, a worker
shall be allowed an interval for rest or meal
of:
a)at least one hour if s/he works more than six

hours in any day.
b)at least half an hour if s/he works more than
five hours in any day.
c)at least one hour under clause (a) or two

such intervals under clause (b) if s/he works
more than eight hours in any day.
Working Hours
Working hours for women
Limitation of hours of work for women: As

per section 109 of the Bangladesh Labour
Law 2006, no women shall, without her
consent, be allowed to work in an
establishment between the hours of 10 p.m.
and 06 a.m.
Working Hours
Examples of non compliance
- Excessive daily / weekly working hours

- Working on weekly holidays
- Women work at night
- Only half an hour lunch / rest break instead
of one hour
Wages and Benefits
Definition of wage as per section 2(45) of

the Bangladesh Labour Law 2006: Wages
means all remuneration including any
other additional remuneration (such as
termination, death, retirement benefit
etc.) payable if the terms of employment
were fulfilled.
Wages and Benefits

Wages do not include:
a) the value of any house accommodation,

supply of light, water, medical
attendance or other amenities or
services excluded by general or special
order of the Government;
b) any contribution paid by the employer

to any pension fund or provident fund;
c) any traveling allowance;
d) any sum paid to the worker for special

expenses entitled by the nature of his
employment.
Wages and Benefits
Wages include as per section 120, Bangladesh Labour Law 2006:
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 due to termination of
employment, whether by retrenchment, discharge, removal, resignation,
retirement, dismissal or otherwise, and
e) Any sum payable due to lay off or suspension.
Wages and Benefits
Responsibility for the payment of wages

Responsibility for the payment of wages: As
per section 121 of the Bangladesh Labour Law
2006, every employer is responsible for the
payment of all wages required by law to his
workers.
The employer is also responsible for the

payment of wages if any worker is employed
in the establishment through contractor (such
as security guards).
In case the wage of a worker employed

through contractor is not paid by the
contractor, the employer shall pay the wage
and adjust the same from the contractor.
Wages and Benefits
Minimum rate of wages
Prohibition to pay wages at a rate below the minimum rate of wages: As per
section 149 of the Bangladesh Labour Law 2006, the employer shall pay at least
the minimum wage to the workers as per the minimum wage declared by the
Minimum Wage Board.
If under any agreement or award or otherwise a worker is entitled to receive

any wages at higher rate, any other amenities or advantages then s/he will
continue to enjoy these.
Wages and Benefits

New Wage Scale of Minimum rate of Wage
Bangladesh Gazette
Sunday, October 22, 2006
SRO No 280/Ain/20 06/SRKOM/SH -6/NIMOBOARD/
Schedule A
Basic House Rent Medical Allowance Hourly OT Total Gross
Name of Post & Grade
Wage 30% of Basic Premium wage
GRADE 1
Pattern Master, Chief Quality Controller, Chief Cutting 3800.00 1140.00 200.00 36.00 5140.00
Master/Cutting Chief, Chief Mechanics
GRADE -2
Mechanic, Electrician 2800.00 840.00 200.00 26.00 3840.00
GRADE -3
Sample Machinist, Mechanics, Sr. Sewing MC Operator,
Sr. Winding MC Operator, Sr. Knitting MC Operator, Sr.
Linking MC Operator,Sr. Cutter, Sr. Quality Inspector,
Sr. Marker/Drawing Man/Women, Sr. Line Leader, Sr.
Over lock MC Operator,Sr. Button Stitch MC Operator,
Sr. Kansai MC Operator, 1730.00 519.00 200.00 16.00 2449.00
GRADE -4
Sewing MC Operator, Winding MC Op erator, Knitting
MC Operator, Linking MC Operator, Cutter, Mending
Operator, Pressing Man/women, Finishing Iron
man/Women, Folder (Finishing), Packer, Quality
Inspector, Over lock MC Operator, Button Stitch MC
Operator, Kansai MC Operator , Poly Man/W omen, 1577.00 473.10 200.00 15.00 2250.10
Packing Man /Women , Line Leader
GRADE -5
Jr. Sewing MC Operator, Jr. Winding MC Operator, Jr.
Knitting MC Operator, Jr. Linking MC Operator, Jr.
Marker/Drawing Man/ Women, Jr. Cutter, Jr. M ending
operator, Jr. Pressing Man/women, Jr. Finishing Iron
man/Women, Jr. Folder (Finishing), Jr. electrician, Jr.
Packer, Jr. Over lock MC Operator, Jr. Button Stitch MC 1420.00 426.10 200.00 13.00 2046.00
Operator, Jr. Kansai MC Operator ,
GRADE -6
Gen. Sewing MC Operator, Gen. Winding MC Operator,
Gen. Knitting MC Operator, Gen. Linking MC Operator,
Gen. Mending operator, Gen. Fusing MC Operator, Gen.
Collar Turning MCOperator, Gen. Over lock MC
Operator, Gen. Button Stitch MC Operator, Gen. Kansai 1270.00 381.00 200.00 12.00 1851.00
MC Operator
GRADE -7
Asst. Sewing MC Operator, Asst. Winding MC Operator,
Asst. Knitting MC Operator, Asst Linking MC Operator,
Asst Fusing MC Operator, Asst. Mending operator, Asst.
Marker/Drawing Man/WomenPocket Creasing MC
Man/Women, Line Iron Man /Women/ Asst. Dry Wash
Man/ Women, Asst. Over lock MC Operator, Asst. 1125.00 337.50 200.00 10.82 1662.50
Button Stitch MC Operator, Asst. Kansai MC Operator,
Finishing Assistant
Trainee/Apprentice: They will get Taka 1200.00 per month as training allowance and their training period will be for three months. After completion of the training period
they wilfall under grade -7
14 PROGRESS -Compliance,
PROGRESS Component on Social and Environmental Social & Environmental Standards
implemented by Component
GFA Consulting Group
Wages and Benefits

Overtime work
Extra allowance for overtime: As per section

108 of the Bangladesh Labour Law 2006,
overtime wage shall be paid at the rate of
twice his / her basic wage + dearness
allowance and ad-hoc or interim pay, if any.
The formula of calculation of overtime wage

is:
Basic wage + (dearness allowance + ad-hoc or interim pay, if any)

--------------------------------------------------------------------------------- x 2 x no. of overtime hours
208
Wages and Benefits

Wage periods
Fixation of wage periods: As per

section 122 of the Bangladesh Labour
Law 2006, the employer shall fix
periods for the payment of wages
which is called wage period; no
wage period shall exceed one month.
Time of payment of wages: As per
section 123 of Bangladesh Labour Law
2006, the wages of every worker shall
be paid within seven working days
from the last day of the wage period.
All wages shall be paid on a working
day.
Wages and Benefits

Deduction of wage for absence
Deduction for absence from duty: As per section 126 of the Bangladesh Labour
Law 2006, deduction of wages can be made against the unauthorized absent
time / day.
No such deduction can be made against the period of time while s/he was at
work / duty.
No such deduction can be made against the period of time / day while s/he
was not required to work.
Wages and Benefits

Deduction of wage for damage or loss
Deduction for damage or loss: As per section 127 of the Bangladesh

Labour Law 2006, deduction can be made for damage or loss of goods or
money caused to the employer by neglect or default of the worker.
Before such deductions are made, following principles of natural justice

the employer shall give the opportunity to the workers so that they can
defend themselves.
All such deductions shall be recorded in a register.
Wages and Benefits
Deduction of wage for damage or loss
Deductions for services rendered: As per section 128 of the Bangladesh Labour Law
2006, deduction from wages for house accommodation or for such amenities and
services supplied by the employer cannot be made unless:
- the house accommodation, amenities or services are accepted by the employee

as a term of employment or otherwise;
- such deduction is equivalent to the value of the house accommodation,

amenity or service supplied by the employer.
Wages and Benefits
Fines
Fines: As per section 25 of the Bangladesh Labour Law 2006,
1. The total amount of fine shall not exceed 10% of the wages payable to the
worker in respect of the wage period;
2 No fine shall be imposed to the worker under the age of fifteen years;
3. No fine shall be recovered by installments or after the expiry of 60 days from

the date of imposition;
4. Every fine shall be deemed to have been imposed on the day the misconduct
happened;
5. All fines and all realizations shall be recorded in a register and spent for the
welfare of the persons employed.
Wages and Benefits
Death benefits
Death benefit: As per section19 of the Bangladesh Labor Law 2006, after a
continuous service of three years or more if a worker dies while in service, his / her
nominee or in the absence of nominee, his / her dependant shall be paid by the
employer:
a) A compensation for 30 days wage (basic wage) for every completed year of
service, or for any part thereof in excess of six months, or gratuity, if any,
whichever is higher; plus
b) A compensation for 30 days wage (basic wage) for every completed year of
service or gratuity whichever is higher. (This compensation can be regarded as
retirement benefit because the deceased worker would have been entitled to it,
had s/he been alive).
But if such worker is covered by any compulsory insurance scheme of the
establishment, or, if any compensation is payable for such death by accident
(under Chapter XII), then whichever is higher is payable to the worker (means
higher than the compensations paid under a. and b. mentioned).
Wages and Benefits
Casual and sick leave
Casual Leave: As per section 115 of the

Bangladesh Labour Law 2006, every worker shall
be entitled to 10 days casual leave with full
wages in a calendar year.
Sick Leave: As per section 116 of the Bangladesh

Labour Law 2006, every worker shall be entitled
to sick leave with full wages for 14 days in a
calendar year.
Casual and sick leave shall not be accumulated

and carried forward to the succeeding year.
Wages and Benefits
Annual leave
As per section 117 of the Bangladesh Labour Law
2006, a worker who has completed one year of
continuous service shall be allowed during the
subsequent period of 12 months, to take leave
with wages at the rate of:
- One day for every 18 days of work, in case of

adult worker
- One day for every 15 days of work, in case of
non- adult worker
Section 117 (3): any leave which falls in between annual leave shall be counted as
annual leave.
Section 117 (4) & (5): un-availed annual leave shall be accumulated. The
accumulation of annual leave shall be up to 40 days in case of adult workers and 60
days in case of adolescent workers.
Wages and Benefits
Annual leave
Section 117 (7): any annual leave applied by a worker but refused by
the employer for any reason, shall be added to the accumulated
annual leave.
Section 117 (8): when counting a period of continuous service of 12
months for the purpose of annual leave calculation, the following days
are also considered as work days:
a) Any holiday;
b) Any leave with wages;
c) Any leave with or without wages due to sickness or accident;
d) Any maternity leave not exceeding sixteen weeks;
e) Any period of lay off;
f) Legal strike or illegal lock out.
Wages and Benefits
Annual leave
Festival holidays: As per section 118 of the Bangladesh Labour Law 2006,
every worker shall be allowed 11 days of paid festival holidays in a calendar
year.
Section 118 (3): If a worker is required to work on any festival holiday 2

(two) days compensatory holidays and 1 (one) substitute holiday shall be
provided.
Wages and Benefits
Annual leave
Retirement of worker: As per section 28 of the Bangladesh Labour Law 2006,

a worker employed in any establishment shall retire from employment after
completion of 57 years of age.
- The date of birth recorded in the service book of the concerned worker
shall be the conclusive proof for counting the age.
- The employer shall pay compensation at the rate of 30 days wages (basic)
for every completed year of service or gratuity, if any, whichever is higher,
in addition to any other benefit to which s/he may be entitled under this
Act.
Wages and Benefits
Provident fund
Provident Fund: As per section 264 (10) of the Bangladesh Labour Law 2006,
if three fourths of the total work force of the establishment ask the
management in written to set up a provident fund, it is legally mandatory for
the employer to do so.
Section 264 (9): If such provision exists, every permanent worker, after
completion of one year of service, shall contribute not less than seven
percent and not more than eight per cent of his/her basic wage to the
provident fund, and the employer shall contribute to it an equal amount.
Wages and Benefits

Termination benefit
Termination of employment by
employers, other than dismissal etc.:
As per section 26 of the Bangladesh
Labour Law 2006, the employment of a
permanent worker may be terminated
by the employer by giving:
a) 120 days notice to him or her in
writing or pay in lieu of the notice
period;
b) Compensation at the rate of 30
days wages (basic) for every
completed year of service or
gratuity, if any, whichever is higher;
c) Payment for any un-availed annual
leave days (gross wage);
d) Any other benefits s/he is entitled
to like provident fund, bonus etc.
Wages and Benefits

Termination benefit
Termination of employment by workers:
As per section 27 of the Bangladesh
Labour Law 2006, a permanent worker
may resign from his / her service by
giving 60 days notice to the employer.
If a worker intends to resign from
service without any notice, s/he may do
so by paying to the employer wages in
lieu of the notice period required.
If a permanent worker resigns from his

or her service, the employer shall pay
compensation:
a) At the rate of 14 days wages (basic) for every completed year of service,
if s/he has completed five years of continuous service or more, but less
than ten years;
b) At the rate of 30 days wages (basic) for every completed year of service,
if s/he has completed ten years of continuous service or more.
Wages and Benefits

Dismissal benefit
Punishment for conviction and misconduct: As per section 23 (1) of the Bangladesh
Labour Law 2006, a worker may be dismissed without prior notice or pay in lieu
thereof if s/he is:
a) convicted for any criminal offence, or
b) s/he is found guilty of misconduct under section 24.
Section 23 (3): If a worker is dismissed for any of the above reasons, and if his /
her continuous service is not less than one year, s/he shall be paid compensation
at the rate of 14 days wages for every completed year of service, or gratuity, if
any, whichever is higher.
No compensation shall be paid to the worker who is dismissed for the following
misconducts: theft, fraud, or dishonesty in connection with the employers
business or property.
Wages and Benefits

Dismissal benefit
As per section 23 (2) of the Bangladesh Labour Law 2006, any worker found guilty
of misconduct may be awarded any of the following punishments, instead of
dismissal in consideration of any extenuating circumstances:
a) Removal;
b) Demotion to a lower post, grade or scale of pay for a period not
exceeding one year;
c) Stoppage of promotion for a period not exceeding one year;
d) Withholding of increment for a period not exceeding one year;
e) Fine;
f) Suspension without wages and subsistence allowance for a period not
exceeding seven days;
g) Censure or warning.
Wages and Benefits

List of misconducts (I)
As per section 23 (4) of the Bangladesh Labour Law 2006, the following acts
and omissions shall be treated as misconduct:
a) Willful insubordination or disobedience, whether alone or in

combination with others, to any lawful or reasonable order of a
superior;
b) Theft, fraud or dishonesty in connection with the employers business or
property;
c) Taking or giving bribes in connection with his or any other workers
employment under the employer;
d) Habitual absence without leave or absence without leave for more than
ten days;
e) Habitual late attendances;
Wages and Benefits

List of misconducts (II)
f) Habitual breach of any law or rule or regulation applicable to the

establishment;
g) Riotous or disorderly behavior in the establishment, or any act
subversive of discipline;
h) Habitual negligence of work;
i) Habitual breach of any rule of employment, including conduct or
discipline, approved by the Chief Inspector;
j) Falsifying, tampering with, damaging or causing loss of employers
official records.
Wages and Benefits

Procedure of punishment
Procedure for punishment: As per section 24 of the Bangladesh Labour Law

2006, no order of punishment under section 23 shall be made against a worker
unless:
a) The allegations against him / her are recorded in writing;

b) S/he is given a copy thereof and not less than seven days time to explain;
c) S/he is given an opportunity of being heard;
d) S/he is found guilty, after enquiry;
e) The employer or the manager approves such order.
Maternity Benefit
Employment of women
Employment of women workers is prohibited during

certain periods before and after delivery: As per section
45 of the Bangladesh Labour Law 2006, no employer
shall knowingly employ a woman and no woman shall
work during the eight weeks immediately following the
day of her delivery.
No employer shall employ any woman for doing any

work likely to adversely affect her health, if:
a) the employer has reason to believe, or if she has informed him, that she is
likely to deliver a child within ten weeks;
b) to the knowledge of the employer, she has delivered a child within the
preceding ten weeks.
Maternity Benefit
Entitlement of maternity benefit
Right to, and liability for, payment of
maternity benefit: As per section 46 of the
Bangladesh Labour Law 2006, every woman
employed in the establishment shall be
entitled to maternity benefit of 8 weeks
preceding the expected day of her delivery
and 8 weeks immediately following the day
of her delivery.
To be entitled to maternity benefit, a

woman needs to work for the employer for
at least six months immediately preceding
the day of her delivery.
Despite working for more than six months a
woman is not entitled to maternity benefit if
she has two or more surviving children.
Maternity Benefit
Payment of maternity benefit (I)
Procedure regarding payment of maternity

benefit: As per section 47 of the Bangladesh
Labour Law 2006, any pregnant woman entitled
to maternity benefit under this act may, on any
day, give notice either orally or in writing to her
employer that she expects to be confined within
the next eight weeks. She may nominate a person
for the to receive payment of maternity benefit in
case of her death.
If not given such notice, and she has delivered a
child, she shall give similar notice to her employer
within seven days that she has given birth to a
child.
Maternity Benefit
Payment of maternity benefit (II)
Amount of maternity benefit: As per section 48 (1) of the Bangladesh Labour

Law 2006, the maternity benefit which is payable under this Act shall be
payable at the rate of daily, weekly or monthly average wages, as the case
may be, calculated in the manner laid down in sub-section (2), and such
payment shall be made wholly in cash.
Section 48 (2): For the purpose of sub-section (1) the daily, weekly or monthly
average wages, as the case may be, shall be calculated by dividing the total
wages earned by the woman during the three months immediately preceding
the date on which she gives notice under this Act by the number of days she
actually worked during the period.
Maternity Benefit
Calculation of maternity benefit (I)
Example of Ms. Ratna, a Jr. Sewing Machine Operator

Grade 5, Monthly salary: Tk 2046.00
Date of notice of expected delivery date: 16 August 2007
Month Leave Unauthorized No. of Salary O.T wage Attendan Total

absent days working earned (Tk.) ce Bonus Wages
Earned
days (Tk.) (Tk.)
(Tk.)
May 2007 01 01 24 1980 655 -- 2635
June 2007 02 -- 24 2046 655 -- 2701
July 2007 -- -- 27 2046 709 150 2755
75 8091
Maternity Benefit
Calculation of maternity benefit (I)
Total wages earned during the previous three months

---------------------------------------------------------------------------- x 112 days
No. of days she actually worked during those three months
Tk8091 75 = Tk107.88
Tk107.88 x 112 days = Tk12082.56
Payment of Maternity Benefit for 16 weeks
40 PROGRESS -Compliance,
PROGRESS Component on Social and Environmental Social & Environmental Standards
implemented by Component
GFA Consulting Group
Thank You

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Bangladesh German Development Cooperation

Daily Hours: As per section 100 of the

Weekly Hours: As per section 102 of the

Maximum working hours

Weekly Holiday: As per section 103 of the

Compensatory weekly holiday: As per

Interval for rest or meal

Interval for rest or meal: As per section 101 of

a)at least one hour if s/he works more than six

c)at least one hour under clause (a) or two

Working hours for women

Limitation of hours of work for women: As

Examples of non compliance

- Excessive daily / weekly working hours

Wages and Benefits

Definition of wage as per section 2(45) of

Wages and Benefits

a) the value of any house accommodation,

b) any contribution paid by the employer

c) any traveling allowance;

d) any sum paid to the worker for special

Wages and Benefits

Wages include as per section 120, Bangladesh Labour Law 2006:

a) Any bonus or other additional remuneration payable under the terms of

b) Any remuneration payable in respect of overtime work, holiday or leave;

c) Any remuneration payable under any award or settlement between the

e) Any sum payable due to lay off or suspension.

Wages and Benefits

Responsibility for the payment of wages

The employer is also responsible for the

In case the wage of a worker employed

Wages and Benefits

Minimum rate of wages

If under any agreement or award or otherwise a worker is entitled to receive

Wages and Benefits

Wages and Benefits

Extra allowance for overtime: As per section

The formula of calculation of overtime wage

Basic wage + (dearness allowance + ad-hoc or interim pay, if any)

Wages and Benefits

Fixation of wage periods: As per

Wages and Benefits

Wages and Benefits

Deduction for damage or loss: As per section 127 of the Bangladesh

Before such deductions are made, following principles of natural justice

All such deductions shall be recorded in a register.

Wages and Benefits

Deduction of wage for damage or loss

- the house accommodation, amenities or services are accepted by the employee

- such deduction is equivalent to the value of the house accommodation,

Wages and Benefits

Fines: As per section 25 of the Bangladesh Labour Law 2006,

3. No fine shall be recovered by installments or after the expiry of 60 days from

Wages and Benefits

Wages and Benefits

Casual and sick leave

Casual Leave: As per section 115 of the

Sick Leave: As per section 116 of the Bangladesh

Casual and sick leave shall not be accumulated

Wages and Benefits

- One day for every 18 days of work, in case of

Wages and Benefits