Sacked workers of Bangladesh’s Dragon Sweater gave up half their pay. Now employers breach deal

Among the oldest in the apparel industry, Dragon Sweater Bangladesh Ltd began laying off around 500 workers in March this year as it set out to drive away those who have been with the company for a long time.

The retrenchment was wrapped up as planned by June but the workers were not paid their money. Over the last five months, they have turned to many government agencies and held peaceful protests for backpay without success.

The owner of the company, Mostafa Golam Quddus, a former president of garment exporters’ lobby BGMEA, denies they had dismissed workers.

The Department of Inspection for Factories and Establishments, however, has found evidence of disquiet among the workers of the company over layoffs and overdue payments. The government, workers’ groups, owners, and the BGMEA are meeting regularly to break the deadlock.

The workers of Dragon Sweater factory in Dhaka’s Malibagh demonstrated outside the Department of Labour over back pay on Nov 15, 2020. Photo: Asif Mahmud Ove

In a meeting with the Department of Labour on Oct 12, Quddus signed an agreement to pay off the workers within two months in four instalments, but the owners raised a fresh issue over the sum of the first instalment on Nov 7 and left the overdues unpaid that day.

In the last meeting on Nov 15, the protesting workers kept Quddus confined to the Department of Labour office for three hours upon his failure to pay their wages.

Why the dismissals

Dragon Group’s journey in the apparel industry began in 1984 by knitting sweaters in collaboration with businesses from Hong Kong and China. The BGMEA website mentions nine Dragon Sweaters Ltd factories in Dhaka and Cumilla with more than 1,200 trained workers. The company is renowned in the European market for inventing new designs.

A senior employee at its Malibagh unit who has worked 30 years for the company was among those laid off with unpaid dues, according to the protesters.

The workers of Dragon Sweater factory in Dhaka’s Malibagh demonstrated outside the Department of Labour over back pay on Nov 15, 2020. Photo: Asif Mahmud Ove

“The owner-worker relationship had never been affected by back pay issues. But things changed after the authorities planned to relocate the factory to Cumilla. The decision prompted many to think about quitting their job as it would not be possible for them to migrate to Cumilla,” said Abdul Kuddus Mia, a leader of the protesting workers.

“But when the factory was not relocated, it was apparent to the workers that the whole thing was a smokescreen created to force them out,” said Kuddus.

“Many who have been working for long expressed their desire to leave with whatever dues and facilities the company owed them when the issue of relocation to Cumilla was raised. But the owners declined their request and asked them to work in Cumilla.

“In October-November last year, the workers had outstanding wages for three to four months and the issue touched off protests. The company then began downsizing the workforce by laying off 20 to 30 workers on different excuses. The company asked targeted staff members to submit their ID cards without prior notice. And in these cases, no employees received the promised benefits on leaving jobs,” Kuddus said.

He pointed out that the second wave of termination came following the restart at the end of the lockdown over COVID-19. Although factories resumed operation everywhere in the country in May, Dragon Sweaters remained bolted. The workers were paid 65 percent of their wages through the government relief package until June.

The workers of Dragon Sweater factory in Dhaka’s Malibagh demonstrated outside the Department of Labour over back pay on Nov 15, 2020. Photo: Asif Mahmud Ove

“Some new employees were hired in May and they were handed Dragon Sweater and Spinning Ltd identity cards as they began work, at a time when we were barred from entering the factories.

“As we sat to talk things over with the owners, we came to know that we no longer had our jobs. However, we’d been getting our long-standing dues gradually,” said the workers’ leader.

That is when the agitations began with a conflict between the workers and the owners over who will get how much.

Owner Quddus, who claims to have never wanted to let any worker go, says it was the workers who called for new appointments through long absences.

He went on to say that the workers were instigated by the leaders of an organisation that intentionally orchestrated the protests to present a negative image of Bangladesh’s apparel industry to the world.

Workers of Dragon Sweater Bangladesh and Imperial Sweater Industries marched with broom from the Department of Labour headquarters in Dhaka on Sep 7, 2020 in a bid to besiege the owners to demand payment of dues from the provident fund, service benefit and earned leaves, but the police stopped their march at Bijoy Nagar.

“The owners never want to miss an opportunity to save money,” said Joly Talukder, a leader of the Garments Workers Trade Union Centre. “They want to use this situation created by the pandemic to save up without adhering to the Labour Act. Are they above the law?” she asked.

Asked about the allegation of instigating the workers, she said, “Is it necessary to provoke the workers if they are not paid for three to four months? They have been forced to make moves for their rights. And why aren’t the owners fulfilling the promise they had made to the labour minister to pay up the workers?”

Contradiction over number of workers and dues

The owners sent a retrenchment list containing details of 433 employees - 83 salaried workers, 269 who were on production-based contract and 75 supervisory staffers - to the Department of Inspection for Factories and Establishments.

The protesting employees, however, claimed that more workers were fired - 504 in total - including 10 managers and merchandisers and all of them were deprived of the benefits they were entitled to. These staff members have the necessary documents to back their claim of dues.

Mir Pashen Ali lost his job in the recent staff attrition at Dragon Sweaters after serving it for 16 years.

Disgruntled garment workers of Dragon Sweater Bangladesh Ltd brought out a procession at Malibagh Chowdhury Para in Dhaka on Wednesday to demand payment of wages and Eid allowance. Photo: Mahmud Zaman Ovi

“My calculations say they owe me Tk 780,000. But according to the owners, it is Tk 360,000. Such distortion makes the calculations pointless. I live in Dhaka with my family and children. I now have to run my family by borrowing money from my relatives. I could’ve looked for a way had I been paid off,” Ali told bdnews24.com.

Md Delowar Hossain, another sacked worker, said, “We can’t work here if they don’t want to keep us. But why aren’t they paying our long-time savings in line with the Labour Act?" he asked before offering, "They don’t want to recognise our work.”

Protest leader Kuddus said the owners put five percent of their salaries every month into provident fund and the service records have the evidence. The owners themselves are supposed to deposit money in that fund.

“But no such accounts were even opened in the bank. Now they are telling us that it was not taken as provident funds, rather as security money. This claim is a complete lie,” he said.

He alleged that the owners forged documents to prove that regular workers were on contract. “Government investigations have made things very clear. We, too, have sufficient [evidence].”

“The dues amount to tens of millions of takas. As much as half of what they owe the workers have been discounted for the sake of negotiations,” Kuddus added.

Dragon ditches deal

On Nov 12, the workers submitted a petition to State Minister for Labour Monnujan Sufian for a solution. The petition said owner Quddus had agreed to pay half the dues, provident fund, service benefits, earned leaves etc, in a deal brokered by the Department of Inspection for Factories and Establishments.

But the owners did not pay the first instalment on Nov 7. Quddus had promised to pay up the second instalment on Nov 22, the third on Dec 7 and the last on Dec 22.

Workers of Dragon Sweater Bangladesh and Imperial Sweater Industries rally outside the National Press Club in Dhaka on Sep 6, 2020, demanding payment of dues from the provident fund, service benefit and earned leaves.

Mohammad Hatem, a member of the crisis management committee formed by leaders of garment industry owners and the Department of Labour, told bdnews24.com: “Dragon Group founder Quddus helped the clothing industry of Bangladesh grow. He is very sincere about paying workers’ dues.

“But there are some officials among the staff who wish to get the facilities reserved for the workers. But they are not eligible for such benefits as per the Labour Act. The mid-level officials are getting in the way of settling the issue of workers’ dues,” he said.

He alleged a local workers’ organisation had sent the photos of protests to Germany in a bid to damage the image of the industry. “They (workers’ organisation) want to use these photos for extortion,” he added.

Shirking responsibility

A four-strong sub-committee of the DIFE visited the factory on Oct 4 and 5. The official list of sacked employees was provided to the government at that time.

The owners claimed that all earned leaves until 2018 were cashed but had no evidence to back the claim. The service records also have no account of the earned leaves being cashed. They could not provide any documents to corroborate their claim of creating a provident fund in 2007 either.

However, the records did reveal the five percent salary of 89 workers and 75 supervisors were cut for provident fund contribution. It also lacked evidence that the owners had deposited the money.

Workers of Dragon Sweater Bangladesh and Imperial Sweater Industries rally outside the National Press Club in Dhaka on Sep 6, 2020, demanding payment of dues from the provident fund, service benefit and earned leaves.

The claims made by the owners include a notice to the salaried workers inquiring about the cause of their absence and a request to join work on Jun 17. But the notices were sent through registered mail between Sep 29 and Oct 2.

The owners claimed that the notice was sent to the workers physically on Jun 15, but failed to provide evidence. The said notice itself only mentioned the date - Jun 17.

The committee mentioned these inconsistencies, among others, as inconceivable.

The company showed letters involving the supervisors’ annual reappointment on certain conditions but the signatures of recipients, workers on service records, and salary receipts were missing.

What authorities say

Rezwan Selim, a director of BGMEA and chief of its committee on the matter, said, “Quddus is a senior among us, a former president of BGMEA. The labour ministry and labour department both are trying to settle the issue in his factory. We are providing the required support.”

AKM Salahuddin, the deputy inspector general of DIFE, said, “Dragon Sweater Ltd signed a deal but failed to honour it. We are trying to get the workers dues from them. In this case, the directorate is unable to penalise the owners. If everything else fails, we will give both sides ‘no-objection’ to move the court.”

“Both parties must give ground to reach a consensus. The workers may have done that, but the owners have refused to budge from their position.”