Bangladesh has amended its labour law to mandate a minimum wage review every three years instead of the previous five-year cycle, paving the way for more frequent pay increases for workers across key sectors including ready-made garments, tanneries, pharmaceuticals, and others.
The government issued the Labour Law (Amendment) Ordinance 2025 on Monday night, following its final approval at the Advisory Council meeting on 23 October. The decision reflects a series of recommendations agreed upon earlier by the Tripartite Consultative Council (TCC), which includes representatives of workers, employers and the government.
Key Changes: More Frequent Wage Revisions and Worker-Friendly Amendments. The amendment introduces a wide range of reforms that labour groups had long demanded. These include: Minimum wage structure to be revised every three years (previously five years), Replacement of the term female with women to ensure clarity and respect, Trade unions can now be formed with a minimum of 20 workers, dropping the previous requirement of 20% of the workforce, Mandatory provident fund for any factory with at least 100 permanent workers, Maternity leave increased from 112 to 120 days, Festival holidays expanded from 11 to 13 days, Clear definitions of which behaviours constitute sexual harassment, Strong prohibitions against discrimination based on race, caste, gender, religion, political opinion, nationality, social origin, descent or disability, Formation of a National and Sectoral Tripartite Council, National Social Dialogue Forum, and Alternative Dispute Resolution Authority, The law also explicitly bans the blacklisting of workers, a practice long criticised for pushing workers into unemployment after labour unrest or wage-related protests.
Opinion Split Between Workers and Employers: Labour leaders have welcomed the reforms, saying Bangladesh has taken a significant step toward ensuring better working conditions and rights. However, employers have expressed dissatisfaction, accusing the government of deviating from TCC decisions and creating confusion in defining “workers.” Taslima Akhter, President of Garments Workers Solidarity, told Prothom Alo that the amendments mark real progress: “Bangladesh has moved one step forward in securing labour rights. The law is worker-friendly, and employers have no reason to be alarmed. Effective implementation will require cooperation among government, owners and workers.” She noted that labour groups had demanded six months maternity leave, which remains unfulfilled but hoped it will be considered in the future.
On the other hand, BKMEA President Mohammad Hatem sharply criticised the ordinance, alleging that the government altered key provisions under pressure from unnamed quarters. “The government has deviated from what was agreed in the TCC meeting. The revised definition of workers creates confusion and does not protect their interests. This will damage the industry and increase labour unrest,”
Hatem said, adding that the government rushed the amendment despite having time until next March.
Unionisation Made Easier: New Thresholds Introduced: Under the new law, the requirement for forming a trade union has been revised extensively. Instead of a percentage-based approval system, the amendment sets fixed numbers of workers required for union registration: 20-300 workers: Minimum 20 signatures, 301-500 workers: Minimum 40 signatures, 501-1,500 workers: Minimum 100 signatures, 1,501-3,000 workers: Minimum 300 signatures, 3,001+ workers: Minimum 400 signatures, A maximum of five unions will now be allowed per establishment, up from the previous limit of three.
Labour leaders say these changes will significantly increase unionisation, as the earlier percentage-based requirement often prevented workers from organizing in large factories.
Mandatory Provident Fund: Clarity and Alternatives: Although the earlier law provided for setting up provident funds, implementation was rare because it was not mandatory. Now, any factory employing 100 or more permanent workers must create a provident fund.
However, an alternative has been offered: If workers choose to participate in the Universal Pension Scheme (Progoti), the employer will be exempt from forming a provident fund. In that case, both sides will contribute 50-50 to the pension scheme.
Stronger Protections Against Abuse and Political Interference: The ordinance also bans owners or employer associations from influencing the creation or functioning of worker organisations. Employers will not be allowed to: Form or run unions under their control, Favour or dismiss leaders of particular unions, Encourage the creation of rival unions to weaken existing ones, The law clarifies what constitutes sexual harassment and prohibits any discriminatory treatment of workers-including exclusion, demotion, or deprioritisation-based on personal characteristics.
Implementation Will Be the Real Test, Say Labour Leaders: Although labour organisations have expressed cautious optimism, they say the law’s effectiveness will depend entirely on enforcement.
Labour leader Babul Akhter told the Daily Industry: “For workers to truly benefit, the implementation authorities must operate transparently and be held accountable. Corruption must be eliminated, and monitoring strengthened.”
He also noted that applications for union registration will rise substantially due to easier requirements, meaning the Labour Department must enhance its capacity and recruit skilled officers.
A New Era for Labour Rights: The amended ordinance marks one of the most substantial overhauls of Bangladesh’s labour regime in recent years and is likely to have far-reaching implications for the country’s industrial relations, wage planning, and compliance framework-especially in export-oriented sectors under intense global scrutiny. Whether the reforms reduce months of recurring labour unrest or spark fresh disputes will largely depend on how smoothly the new rules are implemented in the coming months.
