The Bangladesh government is considering forming a new wage board to raise the minimum wage for ready-made garment (RMG) workers, according to government sources. The current minimum wage of Tk12,500, set in December 2023, marked a more than 56% increase over the previous rate. A recent amendment to the Bangladesh Labour Act (BLA) in late 2025 reduced the interval for minimum wage revisions from five years to three, making December 2026 the deadline for a new wage determination in the sector.
The labour and employment minister and secretary met with senior leaders of garment owners’ associations, where owners’ representatives “didn’t disagree” with the proposal, though timing concerns were raised. “Primarily, we will form a committee, and there are some processes to complete before forming the board,” Md Abdur Rahman Tarafder, the ministry’s secretary, stated. The government aims to establish the wage board by October, following standard procedures including meetings, proposal submission, approval, and gazette notification, which historically take about six months.
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Industry Concerns Over Timing and Costs
Garment factory owners expressed reservations about increasing wages at this time. Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), noted that the RMG sector is “going through a tough time” with declining export orders and rising production costs, while buyer prices have not adjusted accordingly. “If wages are increased, the industry will not be able to bear the additional pressure,” he warned, adding that more factories could be added to closure lists. Hatem also argued that some interpretations of the amended Labour Act are incorrect, stating that amendments cannot have retrospective effect under the law.
Labour leaders welcomed the potential wage board formation but emphasized urgency, demanding a new minimum wage be set by December to allow implementation from January 2027. Kalpona Akter, executive director of the Bangladesh Centre for Workers Solidarity (BCWS), said the move should have occurred earlier to meet the legal deadline. She also stressed that wage increases need to be accompanied by measures to control essential goods prices, housing costs, and other expenses directly affecting workers. Additionally, she highlighted the need for garment exporters to build capacity in negotiating better prices with buyers.
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Worker Impact Amid High Inflation
Shompa Akter, a garment worker at Armana Apparels Limited in Dhaka’s Tejgaon area, described the challenges of living on the current Tk12,500 minimum wage. With no overtime options, she struggles to support her family of four, citing rising costs for rent, food, and essentials. “My standard of living has not improved,” she said, noting that while she received an extra Tk4,500 in 2023, her rent increased by Tk1,000 and other prices rose further. “I have not been able to afford better medical treatment, better food or better accommodation even after the wage hike,” the 25-year veteran of the sector explained.
The persistently high inflation rate, remaining above 9%, has eroded workers’ wage gains since the 2023 increase. While the government’s proposed timeline for forming the wage board by October could allow for a December 2026 implementation, labour leaders argue that delays risk perpetuating economic hardship. The amendment to the BLA shows the legal obligation to revise wages regularly, yet the intersection of global market pressures, domestic inflation, and industry profitability remains a contentious issue for policymakers and stakeholders alike.
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