Retrenchment Under The Bangladesh Labour Act, 2006

Foreword

The Bangladesh labour Act, 2006 lays down the different modes by which relation between a particular worker and company ceases. Different modes embody different grounds for separation. Retrenchment is one of those modes. Section 2(11), 20& 21 of the Bangladesh Labour Act, 2006 embodies the provisions regarding retrenchment.

Meaning of Retrenchment

Section 2(11) of the Bangladesh Labour Act, 2006 defines the term ‘retrenchment’ as the means of  separation of a worker from the service by the employer on the ground of redundancy’. In other words, when an employer finds that he has larger number of workers than he needs to accomplish the workload available in a particular establishment, the said employer has to reduce the number of workers on the ground of needlessness. This is called retrenchment.

Legal Authority for Retrenchment

The section 20(1) of the Bangladesh Labour Act, 2006 gives the legal authority to retrench a particular worker on the ground of redundancy or needlessness. As per the section 20(1) of the Bangladesh Labour Act, 2006, a worker may be retrenched from the service of any establishment on the ground of redundancy.

Procedure of Retrenchment

Section 20(2) of the Bangladesh Labour Act, 2006 lays down the procedure for the retrenchment. It states that if any worker has been in continuous service under an employer for not less than 01 (one) year, the employer shall-

a) give him 01 month notice in writing mentioning the reasons for his retrenchment or in lieu of such notice, pay him wages for the period of notice;

b) send a copy of the notice to the chief inspector or any other officer specified by him and another copy to the collective bargaining agency;

c) pay him as compensation 30 days wages for his every year of service or gratuity, if any, whichever is higher.

Retrenchment Under section 16(7)

Section 20(3) of the Bangladesh Labour Act, 2006 lays down that notwithstanding anything contained in section 20(2) of the, in the case of retrenchment under section 16(7) of the Bangladesh Labour Act, 2006, no notice shall be necessary to serve but the worker so retrenched shall be paid further 15 days wages in addition to the compensation or gratuity which he entitled to get under the relevant provisions of law. Now, it is pertinent to mention here the content of section 16(7) of the Bangladesh Labour Act, 2006. Section 16(7) of the said Act states that in any case, during a calendar year, if a worker is to be laid-off for the further period of after the first 45 days as mentioned in the relevant section, for any continuous period of 15 days or more, the employer may instead of lying off such worker, retrench him under section 20.

Applicability of Last come first go rule in retrenchment

Section 20(4) of the Bangladesh Labour Act, 2006 reflects the rule “last come first go”. It states that where a worker of any particular category is required to be retrenched, the employer shall retrench the worker who was employed last in that category.

Re-employment of retrenched workers

Section 21 of the Bangladesh Labour Act, 2006 contains the provisions regarding re-employment of retrenched workers. It states that where a particular worker is retrenched and the employer intends to employ again the said worker within a period of 01(one) year of such retrenchment, the employer shall send a notice to the last known address of the retrenched worker asking him to apply for employment and any worker who applies for re-employment in response to such notice shall be given preference and if more than one such retrenched workers apply, the preference shall be given on the basis of their seniority in their previous service.

Author : H.M. Muntasir Romel; Advocate, Supreme Court of Bangladesh & Legal Researcher