Labour Law (Amendment) Ordinance and Due Diligence

The notion of human rights due diligence (HRDD) is a structured method,  which state and nonstate actors have to apply to identify, prevent, mitigate, and account for adverse human rights impacts arising from their actions. Needless to say, an important aspect of HRDD is labour rights.

The United Nations Guiding Principles on Business and Human Rights (UNGPs), which were unanimously adopted by the UN Human Rights Council in 2011, has been the starting point of this recognising this obligation. In this age where private entities have immense influence, the UNGPs recognise the important responsibility that nonstate entities have in protecting human rights. The OECD Human Rights Due Diligence Guidance further operationalises these principles by providing extensive, industry-neutral guidance to help business entities implement HRDD in their business operations.

As a growing practice, several jurisdictions have made HRDD a legally binding obligation. For instance, the Duty of Vigilance Law, 2017 of France and the Supply Chain Act, 2023 of Germany, impose mandatory HRDD obligations. Bangladesh, too, has an important role to play here as it is a major manufacturing hub, especially in the RMG sector. The Labour (Amendment) Ordinance 2025 (the "Ordinance") addresses many of the gaps that existed in our legal framework and aligns domestic law more closely with international HRDD standards. While the amendment is primarily a labour reform, it strengthens the legal environment in which HRDD can operate effectively.

The Ordinance has introduced significant reforms. ILO Conventions Nos 87 and 98 identify freedom of association as an enabling right, essential to protect other labour rights. Section 179 of the Act is amended to make trade union formation more accessible by replacing the percentage-based threshold with a fixed minimum threshold of 20 workers, subject to proportionate increases for larger establishments.

Maternity leave is extended from 112 to 120 days by amending section 46 of the Act. Moreover, instead of treating sexual harassment as an individual criminal offence, the Ordinance has addressed it through an organisational accountability framework with the requirement of establishing a complaint committee with female representation. It has also introduced a detailed definition through the insertion of sub-section 52A under section 2 of the Act, covering thirteen forms of sexual harassment. The Ordinance has also introduced sections 345A to 345B in the Act prohibiting discrimination based on race, gender, religion, etc. These changes reflect the principles found in ILO Convention 190 and the UN Women GAIA Principles.

Moreover, the Amendment has extended protection to certain types of workers who were previously not protected, eg, domestic workers. In line with the UNGPs principles 26 to 31 on accessible, timely, and effective remedies, the 2025 amendment has established a three-tier remedy infrastructure, namely workplace complaint committees, and grievance redressal.

The Ordinance has further amended section 195 of the Act to prohibit worker blacklisting and bar the employers from preparing and maintaining a list or database of workers ineligible for re-employment after termination for any other reason. It has also prohibited employers from undermining trade unions, such as influencing formation, manipulating leadership, or dismissing union members, aiming to correct power imbalances.

In a nutshell, the Labour Ordinance has brought many changes that align on paper with international standards. In practice, these changes must be strictly put in play for us to reap the benefits. 

Fairuz Islam Studies law at Bangladesh University of Professionals and works at Ergo Legal Counsel.