Muhammad Yunus Sentenced to 6 Months in Jail for Labor Violations

A Bangladeshi labor court has convicted Nobel Peace Laureate Muhammad Yunus and three of his associates from Grameen Telecom, a company founded by Yunus, for violating the country’s labor laws. Each of the accused were sentenced to six months in jail on Monday. However, the court immediately granted all four bail, pending appeal.

Yunus was awarded the Nobel Peace Laureate for his work in poverty alleviation through the establishment of Grameen Bank in 1976. The bank pioneered microcredit organizations, which offer micro-loans and do not require collateral. In 1997, Yunus also founded Grameen Telecom, aiming to enhance telecommunication services in rural areas through the Village Phone Programme. It is this second organization that is at the center of the charges against Yunus and his three associates.

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The criminal suit, filed by the Department of Inspection of Factories and Establishments (DIFE), alleged that 67 employees should have been made permanent under Section 4 (7) (8) of the Bangladesh Labour Act of 2006. Grameen Telecom argued that the employees were hired on a contractual basis, renewable every three years, in alignment with their business activities. Specifically, Grameen Telecom cited the three-year contracts with Nokia Care and Huawei Care for the Village Phone Programme.

DIFE also contended that Grameen Telecom failed to constitute 5 percent of its profits as Workers Participation Funds and Welfare Funds (WPPF) per Section 234 of the Labour Act. However, Grameen Telecom defended its position, citing its not-for-profit status under Section 28 of the Bangladesh Companies Act of 1994. According to the company, profits are not distributable and are instead reinvested to achieve social objectives. Employees were reportedly aware of this and did not demand the 5 percent WPPF for over a decade.

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In the verdict, the head of Third Labor Court of Dhaka Sheikh Merina Sultana upheld DIFE’s arguments, leading to the conviction of Yunus and his colleagues.

Grameen Telecom stated has claimed that the criminal charges filed against Yunus and his associates—who are non-executive board members with no proprietary interest in the company’s affairs—demonstrate a clear malicious intention to harass them. Grameen Telecom highlighted the availability of civil remedies under the Labour Act, which the employees could pursue against the employer-company for alleged deviations.

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Amnesty International condemned the verdict on Monday as a “blatant abuse of labour laws and the justice system,” linking it to Yunus’ work and political dissent. In August, a group of laureates, including Barack Obama, signed an open letter calling for an end to the perceived judicial harassment.

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