Need for trade union reform

By Khondkar Ibrahim Khaled, The Daily Star, Vol. 4 Num 244, 31 January 2004

Reform is now a prime agenda in many sectors of governance and economy. Banking sector has been undergoing sustained reform measures since early 90s. Recently, another package of reform programmes has been finalised for Nationalised Commercial Banks (NCBs). Central Bank Restructuring Project is also ready for implementation. Restructuring has already taken place in Power Development Board, by splitting of distribution agencies like, DESA and DESCO. Water and Sewerage Authority has introduced reform measures. We have heard about restructuring of sick industries Adamjee Jute Mill has been closed, some industrial Units are on sale to private sector. Judicial reforms have been projectised. Examination system did not escape—grading system has been introduced.

These are illustrations of large scale reforms encompassing almost all the sectors of governance. Surprisingly, Trade Unions remain outside the preview of reform. While reform has not been considered for trade unions as a whole, attempts were made to contain or promote TUs with sectoral approach. Donor agencies recommended for closure of TU activities in the banking sector, while paradoxically they are eloquent about introducing trade unionism in the Export Processing Zone. Reports reveal the entrepreneurs of EPZ do not favour the idea of trade unionism. Some of them opined that trade union activities will interfere with production and they may have to shut down their industries. Observers feel that introduction of trade union activities in EPZ will adversely affect the country's export, almost pointing to a design of sabotage.

Country's experience with trade unionism is far from satisfactory. At times, it was bitter, harmful and counter productive. Trade unionism was conceived as a measure of protecting the rights of workers. But Bangladesh witnessed how treaturously others rights were violated by organised hooligans under the garb of trade unions, how productive environment was vitiated by incidents of extortion, abstaining from work and creating parallel management.

To understand the gravity of situation, we may recall some incidents and reproduce some news items and editorial remarks from the newspapers.

In 1981, the Managing Director of Sonali Bank was manhandled and a General Manager was severely beaten up by a trade union leader of that bank. The General Manager was hospitalized and the Managing Director was transferred. But the CBA leader was not subjected to any administrative action. He came out as a hero.

In 1987, a trade union leader of Bangladesh Krishi Bank (BKB) entered the office of the Managing Director by breaking open the door. He was drunk and was shouting with filthy language. Managing Director knew that the Trade Union leader was personally known to top political leaders of the ruling party. He decided to bring it to the notice of the President of the country, as he was scheduled to attend a presidential meeting shortly. The Managing Director reached the President's Office a little ahead of time and found that the President was talking to that TU leader with an intimate gesture of placing his hand over the shoulder of the TU leader. The TU leader was a Peon.

In 1998 TU workers stormed into Bangladesh Bank Governor's room after injuring the GM (Admn). The Daily Star in its first editorial of January 21, 1998, describes the incident- “Bangladesh Bank, the central bank of the country looks diminutive today after what happened within its precints on Monday. The rumpus was on a high dare-devilry rating with 40-50 employees storming into GM (Admn)'s chamber and ransacking it to a point where he had to duck under the table only to be sitting target for kicks and punches from the intruders. The GM desperately ran for shelter at the governor's chamber. There he and the governor paid audience to spiteful remarks with a blistering demand shouted at them for their immediate removal from office… “A case was filed with Motijheel thana. Nothing transpired till now. Administrative action initiated at BB, did not produce any punishment.

On 18 May, 1997, The Daily Star published an investigative report revealing how state owned banks are kept hostage by CBAs. The report states, “CBAs are affiliated with major political parties and have very good connections with political leaders and influential ministers. —- Normally 80 per cent of transfers are done on the ‘request’ of CBA leaders, —- 30 per cent of workers, holding different posts in the employee unions, do not perform their official duties. —- Each contractor is compelled to give 2 per cent of the bill amount involved in any work order as toll to the workers' union. —- CBAs have established a parallel management in every NCB, which created a major barrier for improving the activities of the banks. —— Even with regard to promotion and transfer of officials, which is not under their purviews, they intervene and coerce the management. In such cases, they take bribe ranging from Tk 5,000 to Tk 20,000 from the official concerned.”

On October 24, 1997 the daily Sangbad published a report on the affluence of a CBA leader disclosing one of his bank accounts. The account records deposit of Tk 13.77 lac in 21 months, though is total emoluments (without deductions) for that period did not exceed Tk 80,000. The report further disclosed that the CBA leader, a clerical grade employee, maintains a Nisan Suny A.C. car of his own. He has a digital phone at his residence and uses another mobile phone. After adjustment, his take-home pay is just around Tk 2,000 per month. The CBA leader in a rejoinder, published in the same newspaper, claimed that the money belonged to his wife and the car was presented by his father-in-law. A lucky son-in-law in deed!

Trade Union leaders coerce the management for promotion of others, while they refuse to accept promotion to the grade of officers! This is simple economics. Their promotion to officer's grade will entitle them to enjoy a little rise in pay, but will take away their ‘right’ to collect handsome amount of bribe against tadbir for promotion, transfer etc.

A recent newspaper report reveals that major obstacle for privatisation of government sector industries is resistance from trade unions. TU leaders use the industry as a platform to make fortune. Worker-members work as a brute force in the process. Ordinary workers may be innocent, but they are chained by the TUs. None can escape.

TU leaders have innovative ways of earning money. They earn on cars and vehicles on the plea of repair. Cars are not even sent for repair, but bills are presented for payment. Bill amount is shared among the TU leaders, car driver and the workshop. Besides, earning by TU leaders on petrol consumption is another pilferage. Government owned organisations seem to have been conditioned under the process. Hence there is no hue and cry.

Involvement of TU workers in tampering meters of electric supply and WASA is well-known. System loss is the other name of theft. Everybody knows it and nobody finds a way of reversing the process. Similar allegations are common against Line-man of T&T department. Many subscribers are to lubricate the lineman to keep the phone line on. If connection is dead, lodgment of complaint will bring nothing. Lineman must be brought to line. Within the organization of Electric Supply, WASA, T&T and the like, supervising officers are sometimes taken to task, but meter-readers and line-man remain out of any administrative action, as they are Union members and linked politically. In the recent past, an illustrative report came out in the newspapers, showing photograph of a 6-storied building owned by a meter-reader. Nothing happened to him, as he remained under the umbrella of a political boss. Law is for the weak people.

These are few examples of state of affairs in the labour union sector of Bangladesh. Many more grave instances remain beneath the surface. Being alarmed by the gravity of the situation, foreign consultants working with reform agenda of different sectors were puzzled yet unanimous on one point—so called trade unionism is a serious obstacle in implementing reform agenda, and the expert consultants did not know what to do. That is why many of them recommended closure of trade union activities. Consultants of Financial Sector Reform Project (FSRP) were most eloquent on this matter. They finally recommended for ban on union activities of the banking sector. These consultants, who were financial experts having no expertise on labour matters, strongly felt that reform and trade union can not go together in this country. Hence they wanted to kill trade unionism to save reform agenda. This was a naive approach.

A senior executive of Malaysian central bank once told me an incident of their country. Their central bank had no trade unions and some employees were quietly working for organising a platform. As a strategy they invited a strong delegation from United States labour front. Some eminent leaders of US trade unions responded and proceeded towards Kuala Lumpur. Malaysian intelligence brought it to the notice of Prime Minister Mahathir Mohammad, who ordered that the delegation be sent back right on arrival at the Airport. The order was carried out and the attempt of TU formation was nipped in the bud. Two reasons are attributed towards this ‘success' story (i) Mahathir's government was committed for development even at the cost of some rights and (ii) Malaysia was not a signatory to the ILO convention.

Bangladesh case is different. Commitment of all the past governments was situational and questionable. None of them exhibited the firmness and conviction of Mahathir. The other important fact was that Bangladesh was a signatory of ILO convention. Hence Bangladesh can not act the way Malaysia did. Consultants failed to appreciate this point resulting in disappointment.

Every question has one or more answers. Every problem has one or more solutions. As a signatory to ILO convention, Bangladesh probably should not put a ban on trade unions. At the same time, our government must not shut its eyes allowing trade unions to jeopardise the management of our institutions in particular and overall governance in general.

We are arguing eloquently and spending lavishly on reforms of all the sectors of governance. Can we not ponder over reforming the trade unions? I have not heard any foreign consultant to talk on this issue. A task force, formed by the government to review the trade union issues in the banking sector, recommended a reform package for the TU activities. The government was shy to reject it yet hesitant to accept it.

TU Reform

For reforming the trade unions, two-front actions are suggested (i) some irrational stipulations of Labour Laws are to be amended and (ii) to operationalise the labour laws, a code of conduct needs to be framed and enforced. To achieve these objectives following questions are to be resolved:

(i) Present Labour Laws, as amended in mid eighties permit the trade unions to be affiliated with political parties as sister organisation. This is a dangerous stipulation. Employees regulations of state owned organisations do not allow the employees to associate with political parties/activities. But the employees as members of trade union, are allowed (encouraged?) to be associated with political parties/activities. Should we not solve this contradiction? This controversial amendment was made by the dictatorial regime of 1980s. The dictator has gone. But the legacy remains. TUs must be dissociated from political parties.

(ii) The labour law requires a trade union to register membership of at least one third workers of the organization. Theoretically, an organization may have three trade unions, but practically the leading TU (i.e. CBA) must have support of more than one third employees, consequently restricting the number of TUs to two only. A formal study reveals that the number of TUs in Sonali Bank, Janata Bank, Agrani Bank and Rupali Bank is continuing to be 5,6, 5 and 3 respectively. Is it not a violation of Industrial Relations Act? Is the Registrar of Trade Unions is accountable for such violation ? Is he responsible for taking corrective measure?

(iii) Industrial Relations Act may be amended so as to have one trade union in one organization. This was the legal stipulation prior to last amendment. The amendment has brought in conflict, division among employees, and unrest. Now is the time to do away with this amendment and revert to original position.

(iv) An employee/worker shall hold office of CBA for a tern of 2 years and should not be eligible to seek re-election for further term. This is needed for making TUs more democratic and also for freeing TUs from the clutches of despots. An amendment of law is needed to this effect.

(v) An employee, refusing to accept promotion to officers' grade, shall disqualify for seeking TU election. Many employees consider trade unionism as a profitable business and consistently refuse to accept promotion to the higher grade. Hence legal provision is needed to protect TUs from the clutches of such ‘traders.’


By inserting a few amendments in the Industrial Relations Act as suggested above and by operatio-nalising the law by framing a code of conduct for TUs, we may protect the rights of workers and save the workers from the clutches of ‘traders of unionis.’ We need not impose a ban on trade union activities, as suggested by donor agencies and foreign consultants.