RMG wage and buyers' charity

RMG wage and buyers' charity

The wage board formed last month for recommending wages for the workers engaged in the country's apparel industry is now doing the necessary exercise. The task before it is quite a difficult one, for the gap between the money needed to fix a just and fair minimum wage and the so-called affordability of the industry owners is very wide.

The existing wages in the readymade garment (RMG) industry are not sufficient to meet even the basic requirements of the workers. The wage structure has become irrelevant if seen in the context of the current level of cost of living. The increase in rice prices is a pointer to that fact. The prices of the main staple have more than doubled since the announcement of the present wage structure. The situation with other food and non-food items remains almost identical.

By any standard, the wages given to the RMG workers are too low to make a minimum level of decent living. The parties, including the government, which make decisions on the wages, are, apparently, oblivious of this fact.

For instance, the government announced the salary scales for the public servants in 2015. While recommending the pay structure the relevant pay commission had surely taken into consideration the cost of living prevailing at that time. Under the present pay scale, a sweeper on the government payroll gets a gross salary of Tk 15, 250 while the minimum wage of a RMG worker is Tk 5, 300 per month.

Thus, the RMG workers' future wage structure is eagerly awaited by all the relevant parties. The trade union bodies have already demanded a minimum wage of Tk 16,000 for a RMG worker. The demand, however, has been dismissed instantly by the industry owners, claiming that most RMG units would go out of business if they are made to comply with such a radical hike in wages.

There is no denying that some apparel units have been paying wages more than what has been recommended officially. They are also ensuring all other facilities for their workers. But such factories are few in numbers. Overall, wages and other facilities in the sector are highly insufficient.

RMG owners claim that their export earning is not enough to pay, what is called, living wage to their workers. If the RMG units are forced to pay such a wage, they would lose competitiveness in the global market and, eventually, leave the sector.

But the popular perception is that RMG owners are deliberately depriving  workers of their due despite having the financial strength to pay a decent wage. Such perception may either be right or wrong. There is no way of knowing the fact about the financial ability of the RMG owners.

There is no denying that export performance of the RMG units varies; some are doing fine and some others are somehow surviving.

But all the factory owners blame the buyers for their inability to pay higher wages. They allege that buyers, taking advantage of the cutthroat competition in the global textile market, have been offering the least possible prices for the product they procure from Bangladesh. Buyers, however, have never contested such an allegation.

Why would they? They are buying from Bangladesh because low-segment apparel products are cheaper here. The products are cheaper mainly because of the availability of low-cost labour in abundance. The reasons are quite simple.

Countries in Europe and North America are main destinations of Bangladesh garments. Buyers, who include large retail houses of international repute, often ask questions about physical safety and security of RMG workers. They became very vocal about those issues following some major industrial accidents, including Rana Plaza collapse and Tazreen fire, in Bangladesh. But these buyers hardly talk about the financial security of workers.  Had they offered a bit higher prices against their purchases, the disbursement of higher wages among the RMG workers would have been possible.

A vernacular national daily Sunday last ran a front page story that showed the huge gap between procurement and selling prices of apparels. It was claimed in the report that a shirt procured from a Bangladesh factory at a cost of US$10 is being sold at US$100 in Western markets. The reporter concerned quoted the owner of the RMG factory in question.

In a way these profit-hungry retail houses are cheating both exporters and consumers in their respective home countries. The former could pay a little bit more for the merchandise they buy from a country like Bangladesh with a condition that the excess amount must be used for hiking wages of workers or for their welfare. They might react saying, 'we are doing business not philanthropy'.  In fact, they are unlikely to utter anything like that, for they know the implications.

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