77% Wage Increase Fallacy

It is two years since the collapse of Rana Plaza in Bangladesh left more than 1200 workers dead, at least 150 missing and thousands physically and mentally scarred. On 24 November it was two years since the Tazreen factory caught fire, killing around 130 workers who could not escape because exit doors were locked.

In the wake of Rana Plaza, Bangladeshi garment workers took to the streets in mass protests, not only about the appalling lack of concern for building safety displayed by the factory owners, their foreign buyers and the Bangladeshi government, but also to protest about their general wages and conditions.

In order to head off the building of a seriously threatening mass movement, the government announced that the minimum wage would be increased by 77 per cent to US$68.

This should have represented real improvement in the lives of Bangladeshi garment workers. Unfortunately it is far from the case. I have just returned from a delegation to Bangladesh, where I met many unionists and garment workers and again visited Rana Plaza and Tazreen.

International revulsion at the horror of Rana Plaza led to the creation of the Bangladesh Accord on Fire and Building Safety, a tripartite effort to improve factory safety involving inspection and remediation of about 1500 (out of 5000) factories. One hundred and seventy-nine apparel brands have so far signed the Accord, including a number of Australian companies.

As part of their Accord commitments Kmart and Target published the names of their supplier factories in Bangladesh and have lengthy ethical sourcing policies. We thought it important to test the claims in these documents.

Factory owners’ fear of scrutiny is so high that it is very difficult for anyone interested in workers’ rights to visit their factories. Instead we specifically sought, through a union working in the sector, to meet with workers from factories producing for Australian brands.

We met with workers from seven factories supplying Kmart and Target. In all cases, while there may have been some improvements to fire and building safety, the terms and conditions of work have, if anything, got worse. Employers almost universally responded to the minimum wage increase by dramatically increasing production targets, often by at least 75%. If workers are unable to reach these targets – and they are phenomenally high: it is common for a worker to be required, for instance, to sew 140 collars an hour – they are forced to work overtime, some of which might be paid but often is not.

As a result of these high production targets and pressure to fulfil orders quickly, eleven hour days are normal and six day weeks are virtually standard. Seven day weeks and 16 hour days are not uncommon. We met workers who had two days of leave per year.

At the same time, unscrupulous landlords decided to take their cut of the increase in the minimum wage by jacking up rents on the workers’ meagre housing (it is not uncommon for up ten workers to share a single room).

Thus garment workers are subjected to such gross exploitation both at work and in their non-work lives that the 77% increase in the minimum wage was considered by all the workers we spoke to as having had a negative effect.

Sick leave was rare, so workers often worked sick or were sacked for missing days. It was common for workers to be sacked for arriving at work late, even if they had missed a minimal amount of time, or for making mistakes.

The problem, of course, is that the workers have no power. The supply of labour seems virtually endless: many garment workers are women from the countryside who must not only keep themselves alive but send money home to their families. It is almost a form of bonded labour, with all the risk placed squarely on the shoulders of the worker (might their conditions of work be unfavourably compared with slavery? – slave owners at least have an incentive to preserve their property by feeding, clothing and housing their ‘property’. The factory owners, in contrast, see workers as purely a resource input, like electricity or fabric, and treat them accordingly).

The repression of unions has been intense. Workers who join unions are often sacked. The legal hurdles for forming and registering unions are prohibitively high. There has been some relaxation of the repression since Rana Plaza, but many of the local unions that have formed are ‘yellow’ – that is, not independent of management or the government. Union organisers face violence from the industrial police – a branch of the police tasked with maintaining industrial peace, which usually means quelling any kind of worker unrest – or from goons hired by factory owners.

Only a small percentage of garment workers are unionised and this lack of union density, combined with the repression of union activity, means that, in general, workers have little voice or power. In these circumstances they rely heavily on NGOs and initiatives like the Accord to provide some support for workplace improvements.

But as all unionists know, real workplace power cannot be imposed from outside. Truly unionised workplaces – where workers have decent terms and conditions and a measure of control over their work lives, including the ability to refuse dangerous work – are places where the workers have taken the power for themselves as unionists and workers.

What is needed in Bangladesh today to prevent future Rana Plazas and Tazreens, and to ensure that improved pay doesn’t just lead to heightened exploitation, is a real union movement free to organise workers and to press its demands for decent terms and conditions of work. This could also be the first step towards the transformation of Bangladesh into a country that values all its citizens and doesn’t offer them up as a sacrifice on the altar of global free market capitalism.

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  • Zoe Canterbury
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