Dhaka North City Corporation (DNCC) has cut the access road to Neptune Accessories Solution in Uttarkhan and begun drainage work at the site.
Excavated soil was piled beside the road, and the factory remained closed following events on 2 August.
A N M Badruddoza, DNCC's regional executive officer for Zone 8, said a drain had long been needed there and that work had been delayed because of objections from the factory.
He said the authority started the work after an opportunity arose following the previous day's incident and expected to repair the road within a week.
Factory workers alleged that the excavation was intended to create hardship for the owners.
The dispute centres on a temporary secondary transfer station beside the factory's only access road in Rajabari Ghat, within DNCC Ward 46.
Factory employees said odours from waste at the station disrupted work and that they had secured a court restriction on storing waste there.
Station worker Hasmat Ali said waste was being kept on part of the public road because of the court order and was later transported to the Aminbazar landfill.
On 2 August, an attempt by a factory manager to record waste being dumped on the road was followed by an argument, pushing, a physical confrontation and brick throwing between the sides.
DNCC Administrator Shafiqul Islam Khan and Dhaka-18 MP S M Jahangir Hossain later visited the location, where tensions rose again.
DNCC alleged that its administrator and the MP were subjected to a planned attack, while factory workers said they came out to protect an owner whom they alleged was being harassed.
Uttarkhan police officer-in-charge Habibur Rahman said DNCC had filed a case and 22 people had been arrested.
Two construction workers said an excavator cut the road between about 12:30am and 1am after the confrontation.