Bangladesh approved a labor law on Monday to boost worker rights, including the freedom to form trade unions, after a factory building collapse in April killed 1,132 garment workers and sparked debate over labor safety and rights.

The legislation puts in place provisions including a central fund to improve living standards of workers, a requirement for 5 percent of annual profits to be deposited in employee welfare funds and an assurance that union members will not be transferred to another factory of the same owner after labor unrest.

"The aim was to ensure workers' rights are strengthened and we have done that," said Khandaker Mosharraf Hossain, chairman of the parliamentary sub-committee on labor reforms.

"I am hoping this will assuage global fears around this issue as well," Hossain said.

The legislation is seen as a crucial step toward curbing rising cases of exploitation in a country with 4 million garment factory workers. But activists said it failed to address several concerns and blamed the government for enacting the law in a hurry to please foreigners.

Bangladesh was under pressure to adopt a better labor law after the European Union, which gives preferential access to the country's garment industry, threatened punitive measures if it did not improve worker safety standards.

Tax concessions offered by Western countries and low wages have helped turn Bangladesh's garment sector into the country's largest employment generator with annual exports worth $21 billion. Sixty percent of exports go to Europe.

In late June, US President Barack Obama cut off US trade benefits for Bangladesh in a mostly symbolic response to conditions in its garment sector, given that clothing is not eligible for US duty cuts.

"They have made progress but the government rushed with it," said Rashed Khan Menon, president of the Workers Party of Bangladesh and a member of Parliament.

"They should have spent more time to deliberate on the issue of compensation for the injured and dead, maternity benefits and rights of domestic workers," he said.

Reuters

(China Daily 07/16/2013 page10)