(Reuters) — Bangladeshi garment factory owners said on Thursday they had agreed to a proposed 77 per cent rise in the minimum wage, but police used teargas and rubber bullets to break up new protests by stone-throwing workers calling for a bigger increase.
Bangladesh's official wage board had proposed the rise to $68 a month as the minimum wage, up from $38, after a string of fatal factory accidents this year thrust poor pay and conditions into the international spotlight.
The factory owners agreed to the proposal at a meeting with Prime Minister Sheikh Hasina on Wednesday night after several days of violent protests by workers.
"We have agreed to the new wages after the prime minister assured us she would look into our problems," said Mohammad Atiqul Islam, president of the Bangladesh Garment Manufacturers' and Exporters' Association.
He said the new wage, to be officially approved by the wage board, would be effective from next month.
"In the greater interest of our garment sector, we agreed to it. But many small factories cannot afford the rise," Islam told Reuters.
Workers demanding $100 a month took to the streets, blocking major roads and attacking factories in the Ashulia industrial belt, on the outskirts of the capital, Dhaka.
Police used water cannons, fired rubber bullets and lobbed teargas to disperse the stone-throwing demonstrators, witnesses said. More than 50 people, including police, were wounded.
"We will continue protesting until we realize our demand," a protester said.
Violent protests over the pay rise have forced the closure of more than 100 factories this week. About 200 were shut on Thursday.
Labour Minister Rajiuddin Ahmed Raju urged workers to go back to work. He said continuing unrest could threaten livelihoods and warned of action against trouble-makers.
"We are working to ensure decent pay for garment workers," he told reporters after a meeting trade unions. "Culprits who are trying to destroy the industry won't be spared."
The new wage would still be the lowest for garment workers in the world, said Khandaker Golam Moazzem, a research director at the Centre for Policy Dialogue think-tank.
The protests have coincided with violent anti-government protests and strikes led by the main opposition party demanding next year's elections take place under a non-partisan government.
The impasse between the ruling party and opposition over election rules is a fresh threat to Bangladesh's $22-billion garment export industry, the economic lifeblood of the impoverished country of 160 million, employing about four million people, most of them women.
The garment industry, which supplies many Western brands such as Wal-Mart, JC Penney and H&M, has already been under the spotlight after the accidents, including the collapse of a building housing factories in April that killed more than 1,130 people.
Rock-bottom wages and trade deals with Western countries have helped make Bangladesh the world's second-largest apparel exporter after China, with 60 per cent of its clothes going to Europe and 23 per cent to the United States.