
Lay-off, retrenchment, and unjustified dismissals have become a pervasive reality for Bangladeshi workers, particularly in the Ready-Made Garments (RMG) sector. Reports indicate that at least 20,000 workers lost their jobs through lay-off or retrenchment during the first half of 2026. On 6 August, an export-oriented garments factory in Ashulia retrenched 565 workers, citing financial distress and a global economic downturn—a claim disputed by the labour organisation as an ‘inhumane’ act. Under the Bangladesh Labour Act (BLA), 2006, retrenchment is defined as the termination of employment due to redundancy. Section 20 mandates that workers with at least one year of continuous service receive one month’s written notice or one month’s wages in lieu of notice. Furthermore, a copy of the notice must be sent to the Inspector General of the Department of Inspection of Factories and Establishments (DIFE) and any existing Collective Bargaining Agent (CBA). Retrenched workers are entitled to compensation equivalent to 30 days’ wages for every year of service or a gratuity amount, whichever is higher, in addition to outstanding wages. The law also follows the ‘last come, first go’ principle under section 20(4) and grants retrenched workers a right to re-employment preference for one year under section 21. Employers are prohibited from using retrenchment to disguise disciplinary actions or retaliatory measures. Workers may challenge unlawful terminations by filing a written complaint with the employer within 30 days. If the employer fails to resolve the issue, the worker may approach the Labour Court for remedies, including potential reinstatement or payment of due benefits. Currently, Bangladesh has not ratified the ILO Termination of Employment Convention, 1982 (C158), which would provide additional protections such as mandatory consultation with workers’ representatives. Experts suggest that ratifying this convention and mandating early communication regarding potential retrenchments could better protect workers’ interests.
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