Textile entrepreneurs want to link productivity, wages

Textile entrepreneurs requested the government to create a link between the productivity of the workers and their wages, at a time when a new Labour Act is being prepared by the Ministry of Labour and Transport Management to replace the existing Act that was implemented in 1992.
It would help entrepreneurs to fix salaries of workers on the basis of output of their work, if a provision to give wages on the basis of productivity is mentioned in the new Labour Law, chairman of Jyoti Group Padma Jyoti said, during an interaction organised by Federation of Nepalese Chambers of Commerce and Industry (FNCCI) here in the Valley today.
Jyoti Group has several industries including spinning mills.
The entrepreneurs are complaining of rising production cost due to hike in salary, despite the productivity has been taking a plunge.
At present, salaries in both formal and informal sectors are determined through negotiations between the trade unions and the management. "But the procedure overlooks productivity factor and it only fuels price rise, without any concrete effort to improve quality of output," the employers said, adding that continuation of existing practice would result in giving rewards to non-performing employees, who become liability for the firms.
"It would finally lead to less labour productivity and give bad image for the country in the global market," they said.
The employers also suggested that some limit needs to be imposed on the workers right to collective bargaining through trade unions for resolution of several disputes, including those related to pay-scale.
Employers also gave a call for framing a separate law for export-oriented industries, including handicraft sector and readymade garments. "It should have provisions to ensure that production in such industries remain unaffected throughout the year," they urged.
In recent years, domestic ready garment sector has not been doing well but in the first five months of the current fiscal year, the country witnessed a 43.8 per cent growth in readymade garments exports compared to the same period last fiscal year, according to the central bank data.