Overtime Payments and Benefits

1.1.    Wages and Benefits

1.1.1. Wages

·         Wages refer to fixed regular payments made by an employer to an employee. The payments are for labour or services executed as per the contract and on an hourly, daily, weekly, monthly or piecework basis.

·         Wages does not include cost of food, accommodation or transport those provided by the employer.

·         Wages ensure regular income for employees in order to provide employees with a basic standard of living to support themselves and their families.

·         Employees have to be informed in writing (contract) and in a clear and understandable form about job function, working hours, wages, terms & period of payment, benefits, deductions etc.

·         Employees who are paid on piecework basis must get at least the minimum wage in ratio to the hours worked.

·         Employees paid on piece rate basis should get an equivalent wage to the average rates of earnings of regular workers.

·         Minimum wage: Bangladesh has national minimum wage and industry specific minimum wages.

·         The national minimum wage is BDT 3000 for unskilled adult workers and 2500 taka for young worker.

·         Industry specific minimum wage, if available, this needs to be followed. For example in the case of RMG, the minimum wage is BDT 5300 (effective since 2013).

·         Break down of National Minimum Wage:

Type of worker	Basic Wage	House Rent Allowance (40% of Basic)	Medical Allowance	Transport Allowance	Total Wage
Unskilled Adult	1850	740	250	160	3000
Young Worker	1500	600	250	150	2500

1.1.2. Overtime Payments and Benefits

·         Overtime payments refer to the additional amounts paid to employees who work more than 8 hours in a day or 48 hours in a week. Labour law requires that employees who work more than 8 hours in a day or 48 hours in a week must be paid at the rate of twice his Basic Wage.

·         For employees who get paid as piece rate basis, employer must fix time rates as nearly as possible equivalent to the average rates of such workers earnings.

·         Employees are entitled to receive two festival bonus in a year in which the basic wages must not exceed.

·         Women employees are entitled to maternity leave for 16 weeks, provided they have worked for a period of at least 6 (six) months. Women having 2 (two) or more surviving children will not get maternity benefit but can have normal leave. The maternity benefit is paid for 16 weeks at the rate of daily, weekly or monthly average wages in two instalments. 50% while going to leave and rest 50% after delivery of child.