Kenpark Bangladesh (Pvt) Ltd and Regency Garments Ltd are two sister concerns of the Sri Lankan Hirdaramani Group. The group has seven factories altogether in the Chattogram Export Processing Zone (CEPZ) and the Karnaphuli Export Processing Zone (KEPZ).
The company served a layoff notice to its workers on April 11.
Around 31 companies have got approval for layoffs, and more are applying, said relevant sources from the EPZs.
Industry experts say workers will get around 70 percent of their total salary when they are laid-off. Though the owners might suffer losses, there would be no worries for the workers in financial terms.
On the flip side, temporary workers and employees are at risk because they fear that will not get lay-off benefits. Consequently, many of them are at risk of losing their jobs.
There are 179 factories in the CEPZ where around 210,000 workers are employed. And around 80,000 workers are engaged in the 58 factories in the KEPZ.
A layoff notice of a garment factory reads that the company has announced lay-offs till May 11 following the EPZ Labour Act 2019 as buyers have cancelled purchase orders over the global outbreak of Covid-19. There are shortages of raw materials for production, the notice adds.
During the lay-off period, workers do not have to be present at the factory, and their wages will be paid following the rules and regulations of the EPZ Labour Act 2019.
"A number of companies are applying for lay-offs every day. Many of them have received permission," said Khurshed Alam, general manager of CEPZ.
Only permanent employees will get layoff benefits, he added.
Mosihudding Bin Mesbah, general manager of KEPZ, said, "There is no chance of an employee becoming unemployed after being laid off. They will get their jobs back once the factories are in operation again."
Sources at the Bangladesh Export Processing Zones Authority (Bepza) said the work orders of many garments factories were cancelled due to the outbreak of Covid-19.
Since there are no new orders, many of the factories have been shut, and to contain the spread of Covid-19, all EPZs are under the government-announced general holiday until April 25. Bepza sources said that the garment factories applied for the lay-offs based on this situation.
As of now, around 20 garment factories in CEPZ have been allowed layoffs based on Section 11 of the Bangladesh EPZ Labour Act 2019.
Five to 10 factories are applying for layoff every day, and some of them are in the approval process.
Around 11 factories in KEPZ have been permitted to lay-off workers.
During the layoff period, employees – who have worked for at least one year – will be eligible for benefits, according to section 15 of the Bangladesh EPZ Labour Act - 2019.
Relevant sources said that in line with the CEPZ, other factories in eight EPZs have also been processing for layoff.
Based on the labour law, the workers will get half of the basic salary and the full portion of their house rent. They will also get the full bonus.
However, they will not get other relevant allowances like medical allowance and conveyance.
The layoff period is 45 days at a stretch in a calendar year. But based on the application, the lay-off period could be extended for 15 more days.
If the problems are not solved after this period, the factory can terminate the jobs of the employees following the law and after clearing their dues.
An official of Kenpark Bangladesh (PVT) Ltd, seeking anonymity, said that all of their factories are under layoff.
"We received payment for March in due time. We received the layoff notice on April 11," he added.
At the same time, another export-oriented factory, Intimate Apparels Ltd, has terminated the jobs of all temporary workers due to the layoffs, said an official of the factory on condition of anonymity.