Bangladesh will form a new board Sunday to review the minimum wage for garment workers, as authorities sought to quell protests that have disrupted key industrial hubs around Dhaka.
Despite the move, thousands of workers continued demonstrations in industrial areas around Dhaka on Sunday, leading to clashes with police who fired tear gas and sound grenades.
The garment sector is the backbone of Bangladesh's export-driven economy, employing millions of workers and generating the bulk of the country's foreign earnings.
The wage board, comprising representatives of the government, workers, and factory owners, will determine a new minimum wage.
"The issue of forming the wage board has been resolved. There will be no more problems now," Labour and Employment Adviser M. Sakhawat Hossain Chowdhury said at a news briefing.
"The workers should return to work and work smoothly."
Labour leaders said their grievances extended beyond the creation of the board, citing inflation and rising household expenses.
Workers currently earn about 13,000 taka ($106) a month, according to Kalpona Akhter of the Bangladesh Center for Workers Solidarity.
"This time we are demanding a bit more than 30,000 taka, considering inflation and the rising cost of living," Akhter told AFP.
Thousands of factories across the country produce clothing including T-shirts, jeans and sweaters for major retailers in Europe and the United States.
The industry is also seeking to expand beyond its traditional markets, having recently secured greater access to Japan while exploring new export destinations as it competes with regional rivals such as Vietnam.