Pvt cos, banks unwilling to contribute a part of profit

Local companies, including commercial banks and the government are at loggerheads over the former`s contribution of a portion of their profits to the workers` welfare fund.

Different companies including commercial banks are still reluctant to contribute to the government-run Bangladesh Workers` Welfare Foundation (BWWF), formed by the government, despite repeated reminders to comply with the law, ministry officials said.

The labour ministry at a meeting with the top officials of banks asked the latter to clarify within one month the reasons for their non-compliance with the legal provision for contributing of a portion of their profits to the welfare fund, officials said.

"We gave them (banks) one-month time to place specific proposals regarding profit-sharing provision to us as the chief executives of banks sought some more time," Labour Secretary Mikail Shipar said.

The ministry sat with them to remind about compliance with the existing law as some sectors have already contributed their certain amount of profits to the fund, ministry officials said.

At the meeting, the bankers expressed their unwillingness to contribute their profits to the government`s fund, saying banks have been providing different types of benefits to their own employees, the meeting sources said.

The existing benefits given by banks might have to be curtailed if they contribute to the government`s fund, they said quoting some top officials of banks who attended the meeting.

They said they also expressed their disagreement over definition of `workers`.

But they were told at the meeting that since it is a legal requirement, they (banks) have to abide by it.

Vice chairman of the Association of Bankers, Bangladesh Syed Mahbubur Rahman said, "Discussion is going on to come to a reasonable solution in this regard so that the banking industry is not affected."

"We need to discuss with our boards and inform the ministry about our discussion within the timeframe," he added.

According to the amended labour law, profit-making companies have to contribute five per cent of their net profits to the participatory and welfare funds of the company and the government-formed workers` welfare fund. The ratio of the contribution is 80:10:10 respectively.

The labour ministry issued letters to more than 100 companies during the last one and half years asking them to contribute to the fund which would be spent for welfare of workers of different sectors, they said.

Since 2006, a few companies contributed to the fund while participation increased after the law was amended in 2013, a ministry official said.

Multinational companies are responding promptly while the response from the local ones is relatively poor, he said adding multinational companies have obligation to obey the law of the land where they are doing business due to pressure from their global headquarters.

Some 76 companies have so far shared their profits with the fund, according to the labour ministry.

The amount in the fund reached more than Tk 1.66 billion till August 2016.