June 28th, 2010
Labor activist Jim Keady says Indonesians who make team jerseys for the company are living in poverty. Nike says it has sought to improve worker welfare.
Jim Keady with a U.S. soccer shirt. "Despite their low wages, they still
have immense pride in their work," he says of the workers. (John M.
Glionna / Los Angeles Times)
By John M. Glionna, Los Angeles Times
June 28, 2010
Reporting from Jakarta, Indonesia -
Like any die-hard sports fan, Jim Keady eagerly anticipated soccer’s World Cup.
But he isn’t at home watching the matches. Instead, the 38-year-old New Jersey native has been in Indonesia, talking to the workers who make the Nike jerseys worn by nine of the teams in the tournament.
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For years, the former professional goalie has waged a one-man campaign to highlight Nike’s labor practices, complaining that the company pays Indonesian workers low wages to stitch together the uniforms that have made the company the world’s most successful sports garment manufacturer.
Sitting at an outdoor coffeehouse here, Keady produced several Nike jerseys in Cup team colors. “These jerseys are real wealth you can touch,” he said. “They’re making Nike and the players rich while the workers who make them continue to grind out lives of abject poverty.”
Keady’s campaign goes back to 1997 when, as a soccer coach for St. John’s University in New York, he questioned the school’s plans to sign a $3.5-million endorsement deal with Nike.
The devout Catholic insisted that the contract would be hypocritical for a Christian university. “I was told to drop the issue or get out,” he said. “So I resigned in protest.”
The showdown prompted Keady to launch Team Sweat, a nonprofit dedicated to persuading Nike to change its business practices.
Keady said that major sports events such as the World Cup offer an opportunity to reach a wider audience.
“Right now, the eyes of the world are on the World Cup,” he said. “Now is the time to get out my message.”
Nike and its contractors employ 800,000 workers in 1,000 factories across 52 countries. Indonesia is the firm’s third-largest manufacturing site after China and Vietnam, Keady said.
A company spokesman said issues such as salary for workers in its disparate production chain are best dealt with “by negotiations between workers, labor representatives, the employer and the government.”
Erin Dobson, Nike’s senior manager for global public affairs, said the company has participated in efforts to improve overall worker welfare. “We believe there is ample room for innovation in this area,” she said, “and that progress must occur throughout the industry, and at the governmental level, not only in Nike’s supply chain.”
She said Nike’s code of conduct mandates that the company pay the minimum legal wage in each country, which in Indonesia is $122 a month, one of Asia’s lowest.
Keady says that if Nike raised the price of its shoes by $2.50 a pair and gave that money to workers, it would help lift most out of poverty. Nike calls that a simplistic solution that does not take into account complicated country factors.
In 2000, the towering, redheaded Keady moved to Indonesia and lived on the same salary as a Nike worker, which at the time was about $1.25 a day, staying in a 9-by-9-foot home in a community where 10 families share bathroom and kitchen facilities.
He lost 25 pounds in one month and returned to the U.S. to tell of his experiences. “I thought it would be a 10-week tour, but I’ve been on the road ever since,” he said.
Often, his campaign resembles activist Michael Moore’s documentary “Roger & Me” and Keady has recorded his exploits, producing a short film called “Behind the Swoosh.” He also unsuccessfully tried to meet with Phil Knight, Nike chairman and former chief executive, and has sought the support of athletes promoting Nike, including Michael Jordan, Tiger Woods and soccer star Mia Hamm.
But he spends most of his time interviewing workers who don’t make enough money in a week to buy a Nike jersey. Although he hasn’t had time to watch the World Cup games, many of the workers have.
“Despite their low wages, they still have immense pride in their work,” he said. “They’re overjoyed at the fact that many of these World cup players are wearing jerseys made in Indonesia.”
Keady told the story of one Nike factory worker.
“He said that one day, he’d like to be able to buy a pair of Nike sneakers that he helps make,” the activist recalled. “After 19 years of factory work, he wanted to be able to bring home the product so he could show his daughter what Daddy does. That just floored me.”
john.glionna@latimes.com
Copyright © 2010, The Los Angeles Times
June 16th, 2010
Team Sweat:
One of the goals of my trip (as you will read about in future posts) was to find the workers that made the World Cup replica jerseys that I bought at Niketown in NYC before I left for Indonesia. My team had been searching for a couple of weeks prior to my arrival for the plants where these jerseys were produced, but to no avail. Luckily, following our meeting with the Nike shoe factory workers the other night, one of the union leaders said that he had a contact for us at a plant that may have produced this stuff. On Thursday night, he arranged for me to meet with half a dozen workers from this Nike apparel factory.
As I pulled the soccer jerseys from my bag, replicas from the U.S., Brazilian, Australian and English National Teams, and passed them around the room, I was struck by the care and attention that each worker gave to the shirts. When most people grab one of these jerseys, they hold it up to themselves, throw it on, and are off on their merry way. But these workers carefully inspected each piece, running their fingers along each seam and holding it the way that a sculptor might hold and admire a finished piece of art. These were not just soccer jerseys to them, this was their lifework, and the pride they took in what they do and create was evident.
As things turned out, these particular jerseys were not produced at their factory, although they did produce replicas for Nike the 2002 and 2006 World Cups and they are now producing similar Nike products. They shared that there may be a factory within their group that produced these and they would try and find out for me.
As our conversation continued, the workers shared that (to no surprise), the number one issue for them was their wages. Their basic salaries ranged from Rp1.130.000 to Rp1.191.000. The differences in pay were because of the range of jobs that were held (sewing operator, machine tech, sample creators).
They also shared a couple of other interesting things. one of the women told me that whenever Nike monitors are scheduled to visit the plant, workers are told by the managers to lie to the monitors and NOT to discuss anything that might be deemed negative about the plant. The also shared that their work days are very long, sometimes working from 7am-8:30pm. And, when they do have to work long shifts like this, the factory is supposed to provide them with dinner - a meal of at least 1400 calories. The reality is that they get small portions of rice, vegetables, tempeh, and salty fish - not nearly close to the agreed upon standard. They told me that in the past, they used to get a meal allowance of Rp2.250 if they had to work overtime. I know from my research that Rp2.250 would buy you about a third of a portion of a modest meal at the local food stall. So, it seems that whether they are getting the cash or the food, they are being cheated.
We came back to the discussion on wage levels and one of the men shared how tough it is to try and survive on the wages, especially given the fact that he has a daughter. I’m a relatively new parent myself (my daughter will be two in July) and so the issues that workers who are parents face have taken on new personal emotional meaning for me.
I asked him about his daughter and I learned that she is three-and-a-half years old. When she was just three months old, she had to be sent to live with his mother-in-law in a village in central Java between Solo and Yogakarta. Because he makes such a low salary producing for Nike, he is only able to see his daughter two or three times a year. He fought back his pain as he shared this with me and my heart went out to him. I have only been away from my daughter for a few days and I miss her dearly, I cannot imagine only seeing her two or three times a year.
I shared with him and his fellow workers that this situation is unfair. I showed them flyers I had prepared that documented how much Nike made last year from their sweat and hard work.
Nike’s 2009 Revenues: Rp19.200.000.000.000
I also showed them a flyer with the names, photos and salaries of the top five executives at Nike and what they made in 2009.
Phil Knight, Chairman of the Board
Basic salary = Rp28.254.340.000
Total salary = Rp34.564.540.000
Mark Parker, President and CEO
Basic salary = Rp13.769.230.000
Total salary = Rp88.005.870.000
Donald Blair, Chief Financial Officer, VP
Basic salary = Rp7.400.000.000
Total salary = Rp33.470.000.000
Gary DeStefano, President of Global Operations
Basic salary = Rp9.588.460.000
Total salary = Rp39.984.080.000
Charlie Denson, President of the Nike Brand
Basic salary = Rp11.923.100.000
Total salary = Rp73.333.700.000
After showing them these flyers I shared with them that I am quite sure that none of these men or anyone that is working for Nike in the USA had to “export” their babies back to home villages. I shared with them that these Nike executives are getting rich, the Nike investors are getting rich, the athletes that endorse Nike are getting rich, but the workers who produced the real wealth for Nike continue to live in abject poverty. I asked them if they wanted to fight to change this.
One of the women responded, “Yes, we want to fight, but we don’t know how.”
Here our work begins.
JUST(ice) DO IT.
Peace, Jim Keady
June 16th, 2010
Team Sweat:
This morning I attended a demonstration at the famous Bunderan HI statue in central Jakarta.
My colleagues here in the NGO community have been working for months on engaging a number of the major brands to improve conditions for workers. It seems that their negotiations have fallen apart and this demonstration was an attempt to raise public awareness about the current state of affairs.
It does not surprise me that these talks did not lead to the desired end. Without the threat that there will be labor strikes and/or a consumer boycott if demands are not met, these top brands (Nike, Adidas, Reebok, etc.) will go along with these discussions and in the end, do nothing. That is why it is imperative that the focus of our work be grounded in building worker power and encouraging and supporting workers to use their power to bring Nike to the bargaining table.
Peace, Jim Keady
June 16th, 2010
Team Sweat:
I spent the afternoon doing a round of pricing research to update my understanding of the purchasing power (or lack thereof) for Nike’s Indonesian workers.
The current basic monthly salary for a Nike worker here is Rp1.100.000 ($114USD). Here are some average major monthly expenses that all workers have.
Rent Rp300.000
Drinking water Rp100.000
Transportation Rp100.000
If you add up these three major expenses, that equals Rp500.000. If you subtract this Rp500.000 from the basic monthly salary of Rp1.100.000, you are left with Rp600.000. Divide this Rp600.000 by the average amount of days in a month (30) and your remaining daily spending power is Rp20.000. What does that mean?
You will need to eat. You get one (not so great) meal at the factory. You will need two additional meals. A modest meal at the warteg (local restaurant or food stall) will cost you Rp8.000 - two meals, Rp16.000.
If you want to have a bottle of iced tea with one of these meals, that will cost you Rp2.500.
If you want to have a healthy snack during the day (two bananas) that will cost you Rp4.000. You cannot afford the snack.
Isn’t that crazy? You are producing the real wealth for a company that posted $1,500,000,000.00USD in profits last year and you cannot afford two meals, a bottle of iced tea AND a snack.
It is important to note, that we have only discussed SOME expenses. What about clothing, shoes, stuff for your house, recreation, soap, toothpaste, etc.? And, we are only talking about the needs for one adult here. What if you had children?
When the workers here talk about their financial struggles, they say that they are digging a hole today to fill in the hole that they dug yesterday, but the hole in front of them just keeps getting bigger. Ironically, so do Nike’s profits.
Peace, Jim Keady
June 16th, 2010
Team Sweat:
My team and I left my hotel this morning at 6:30am and drove 90 minutes to a Nike shoe factory in one of the industrial areas outside Jakarta. There we sat and waited (again). We were back on the beat looking to document the dumping and burning of Nike scrap shoe rubber.
This is an important issue because Nike has made major public statements about their supposed commitment to protecting the environment. In fact, if you read their most recent corporate responsibility report, it is loaded with claims and planned initiatives on how they say they will limit their global environmental footprint. I am unsure how successful they are going to be since it seems that they cannot even manage their trash in a way that is responsible.
“Therefore the disposal of footwear soles by burning that Mr. Keady discusses in his presentation is either counterfeit or unauthorized.”
- Carolyn Wu, Issues Manager, Nike, Inc. ~ May 10, 2002
As I wrote in an earlier post, I have been pushing Nike on this issue since I first discovered that shoe rubber from their plants was being dumped in burned in villages around the factories. For years, Nike denied any wrongdoing (note the quote above from Nike’s Carolyn Wu).
In 2009 Nike did admit, to me at least, that there was some validity to my claims. Just before my visit to Indonesia in 2009, Nike sent one of their top environmental people from Asia to investigate this issue. During his visit, this Nike exec sat outside a factory and waited for the dump truck to leave the plant. He followed it and found that the end of the line was a public dump where eventually Nike had to clean up 180 dump truck loads of scrap shoe rubber and spend thousands of dollars on an environmental remediation of the site. The resulting policy change was Nike’s new waste management system.
The question I wanted answered, was “Is the waste management system really effective or it is simply another Nike public relations ploy?”
So… there we sat and waited.
The giant yellow dump truck rolled out of the factory gates around 10:15am. We whipped our van around and followed it down the bumpy dirt road. I must share that I felt somewhat uneasy as we were doing this. In 2002 while doing similar research at a dump, I ended up being chased in my van by machete wielding preman (thugs) on motorcycles who worked for the mafioso that ran the dump. They eventually caught us, beat my driver and brought my team back to the dump where I ended up on my knees with the boss telling me, “If you come back here, I will kill you,” as he stood over me with a sword drawn over my head.
The dump truck pulled into a makeshift recycling center that is run by the local community and started to unload. To not raise suspicions with the men who ran this operation, I posed as an American buyer of shoe scraps. We told them that I worked for a company that made artificial soccer fields and that we used this kind of material as a base. They bought the story. From our conversation I learned that they only received the scrap foam from the factory (about 1 ton a day) and it is sold to buyers that use it to make cushions for sofas, chairs, etc. There was no scrap shoe rubber dumped with them, but they told me where it was discarded, a dump site just up the road.
We made our way down the road and came upon the dump site that we were told about. It turned out that while we were at the community recycling center, that another dump truck must have left the plant and come to this site. As it unloaded it’s trash, we watched and waited. It took about 20 minutes for the truck to be emptied of its contents. It was morbidly fascinating to watch the people at the dump sort through the trash as it was pushed off the truck. They scavenged for plastic bottles and anything else that might have value if salvaged.
When the team of men from the factory finished their work, loaded back onto the truck and rolled out back onto the road, we kicked into action.
Alif told the man that ran the dump that I was a Canadian reporter doing a documentary on recycling efforts in Indonesia. Rather than TELL you what I found here, I offer the photos below and will allow you to judge if Nike’s claims about their new waste management system are legit.
Just an FYI, the kind of dumping I described above and that you can see in these photos, happens 3-4 times a day, every day, and the burning happens for hours every afternoon.
JUST(ice) DO IT.
Peace, Jim Keady
June 16th, 2010
Team Sweat:
I spent the early evening of June 8th traveling the broken, dusty roads of an industrial suburb outside of Jakarta en route to a meeting with Nike factory workers. At around 6:30pm, we arrived at the home of a worker and I was invited in. I had met with many of these workers before, so it was a reunion of sorts and I was very happy to see them. I settled into the corner on the floor of the 6×10 room, sparsely decorated with a rug, outdated wall-hangings, and fading blue paint. Following a brief introduction and the gathering of some data, I listened to the all too familiar stories from these eleven Nike factory workers. Despite the fact that they produce the real wealth (the stuff you can actually hold in your hands, or put on your feet) for the $19,200,000,000.00 sportswear giant, they still live in grinding poverty.
As our discussion continued, one of the women, her young face framed by her traditional Muslim headdress, shared how painfully difficult it is to live on her basic monthly salary of Rp1.110.000 ($114USD). Her rent is Rp300.000 and there is pressure to send Rp350.000 back to her family in the village. If there is no overtime for her to work and earn extra pay, this leaves her with Rp405.000 for the month to meet the rest of her basic needs.
Let’s do some math here. If she has Rp.405.000 after rent and sending money home to her family and you divide that Rp405.000 by the average amount of days in a month (30), she is left with Rp15.500 per day to meet the rest of her basic needs. And when a simple meal of rice, vegetables, tempeh, and a small piece of fish costs Rp8.000 and a bottle of iced tea costs Rp2.500, it should be no surprise why she was near tears as she shared that she has to borrow money every month from friends and neighbors to make ends meet.
The remainder of our discussion focused on what we could do together to help get workers the raises they deserve. I shared with them that the consumers and investors from around the world (4,000 of whom live in Jakarta) who are part of TEAM SWEAT are ready to support them in their fight. The workers then shared their fears with me, that if they fight for the wage they want and deserve (Rp3.000.000 per month) and go on strike to make it happen, that they could be fired and that Nike could pull orders from their factory.
I responded to this by saying that their fears may be justified and then I raised the following, “What else would you like to do? Nike’s making money, the factory is making money, the athletes are making money… and you continue to live in poverty. When are you going to stand up and fight for yourselves?” It was a difficult thing for me to say and I prefaced it by letting them know that I shared it with love and solidarity. But I remained firm that Nike’s Indonesian workers could not continue to look for people like me to act like a Santa Claus and bring them the gift of better working conditions and fair wages. It was time for them to take action. Still fearful, they agreed.
We will meet again on Thursday night to continue our discussion and lay the groundwork for a specific action.
Peace, Jim Keady
June 16th, 2010
Team Sweat:
I started today by meeting with Alif and Benny, my friends and colleagues that have been working to organize things prior to my arrival in Indonesia. They reported that contacts have been made with workers at a number of Nike factories and that meetings with workers are in the process of being confirmed. They shared that the key issues remain the same: workers’ wages are too low to meet basic needs; and the workers continue to be afraid of the power that Nike has over them (i.e. they fear doing real organizing and exercising their right to strike for better wages because they could be fired and/or Nike will pull orders).
As our discussion continued, Alif shared something very interesting with me. As I noted above, I did my best to keep my travel plans (specific dates, etc.) a secret on this trip. Despite this, at 7:31pm on Monday night, about 20 minutes before my plane was about to land, Alif got a text message from one of the staff members at Nike’s Jakarta office - “When Jim arrives in Indonesia, tell him I said, ‘hi.’” How Nike knew I was en route is somewhat unsettling, but it is the nature of my work.
After our meeting in Jakarta, Alif and I headed out to a Nike factory. Our plan was to sit outside the plant and wait for the dump truck that carries the scrap shoe rubber to leave the factory and follow it.
A Nike scrap shoe rubber dump site in 2001.
A little background on this… In the summer of 2000, I first unearthed the fact that scrap shoe from Nike plants was being dumped and burned in villages. The slow burning of Nike shoe rubber at a relatively low heat emits dangerous toxins into the air, soil and water. Despite the fact that I put Nike on notice with regard to this issue in 2000, 2001, and 2002, when I returned to Indonesia in 2008, I once again documented the same problem. In the summer of 2008, I shared my updated findings with the top executives at Nike and was promised that it would be addressed. In July of 2009, during my visit to Nike factories with Caitlin Morris, Nike’s Director of Innovation and Sustainable Business, I was shown the new waste management system that would rectify this issue. While it looked impressive, I was not convinced that it would address the problem. Why? Because implementing that kind of system and changing the culture that drives that system would take REAL investment from Nike. What happens now is that Nike tells their subcontractors, “we want this done.” But Nike does not provide the factory with any capital to make it happen, nor are they willing to increase the price they pay to the factories for Nike sneakers to offset the costs. So what you end up with is a nice show for the monitors and Nike telling the world that they have addressed these issues and they have a new system in place, etc. But the reality remains unchanged on the ground.
So, we sat there for hours, clandestinely waiting, but to no avail. We would have to try again.
Peace, Jim Keady
June 16th, 2010
Team Sweat:
After more than a day of travel, I reached Jakarta safely and am ready to begin 10 days of research on the current state of conditions for Nike factory workers here.
I am hopeful that this trip will be productive and rewarding. I also am hopeful that you will enjoy and learn from the accounts of my daily activities.
JUST(ice) DO IT.
Peace, Jim Keady
June 11th, 2010
June 11, 2010
PUBLISHED IN “INSIDE HIGHER ED”
By Jack Stripling
Before he leaves to head the nation’s premier sports governing body, Mark Emmert may have a showdown with the world’s leading athletics apparel provider.
Emmert, who now serves president of the University of Washington and will soon become chief of the National Collegiate Athletic Association, has been urged not to renew the university’s licensing agreement with Nike. In a Tuesday letter to the president, the university’s Advisory Committee on Trademarks and Licensing relayed its unanimous decision that the agreement be severed, barring a satisfactory resolution to an ongoing labor dispute between Nike and Honduran workers.
“[The Committee] feels strongly that we have waited long enough for Nike to meet its responsibility [regarding] workers in its supply chain,” wrote Margaret Levi, co-chair of the committee and a professor of international studies. “We urge you to accept our advice.”
The committee, which previously pressed Emmert to find Nike in violation of the university’s code of conduct, includes student, faculty and staff representatives. While its recommendations are advisory, Emmert has followed the committee’s suggestions in the past.
When the University of Wisconsin at Madison became the first university to end its Nike agreement over the Honduran worker dispute, Chancellor Biddy Martin did so at the behest of the university’s labor licensing committee — the equivalent of the group now encouraging Emmert to do the same.
Washington’s contract with Nike ends December 2010, a month after Emmert is slated to begin his new duties as president of the NCAA. Whether Emmert will make the decision or leave it to his successor at Washington is unclear, a university spokesman said Thursday.
“He’s not come to any decisions,” said Norman Arkans, associate vice president for communications. “I have no idea how long he’s going to take to think about it, but that’s up to him.”
Many of the NCAA’s members, and the NCAA itself, have licensing agreements with Nike. Additionally, Nike is a founding sponsor of iHoops, a youth basketball program run by the NCAA and the National Basketball Association (NBA).
Asked whether his future position as head of the NCAA added any gravity to Emmert’s decision over Washington’s contract, Arkans said “that’s for somebody else to speculate.”
“He’s still president of the University of Washington, and he is acting right up until his last day as the president of the University of Washington,” he said. “He has responsibilities here.”
Emmert’s future with the NCAA is just one of the interesting twists at Washington. The university’s provost, Phyllis Wise, recently became a member of Nike’s corporate board, drawing some criticism from students and faculty who decry the company’s labor practices. Orin Smith, who has served on Nike’s board since 2004, is also a member of the university’s board of regents.
The regents have yet to say whether Wise will step in as interim president when Emmert departs, but as the second-in-command it would be unsurprising for her to take on the role. Even if she does become interim chief, Wise would continue to recuse herself from decisions about Nike, just as she does now as provost, Arkans said.
“It will be another university official with the authority to make that decision,” he said.
It would be unfortunate, however, if circumstances necessitated such a weighty decision about Nike being made at a lower administrative level, said Angelina Snodgrass Godoy, director of the university’s Center for Human Rights.
“I think it’s imperative that this be a presidential-level decision,” she said.
“I don’t question [Wise’s] sincerity in recusing herself,” Godoy added. “But if she’s in a position supervising others who are tasked with [deciding on the Nike agreement] and she sits on Nike’s board, it creates a situation that looks an awful lot to me like a conflict of interest.”
Asked about the committee’s recommendation, a Nike spokeswoman said Thursday that the company “greatly values its relationship with the University of Washington.” Erin Patterson, the spokeswoman, went on to say in an e-mail that the company had not violated the university’s conduct code because “no university branded product” was produced at either of the two Honduras-based companies that have generated controversy over labor practices. There was a “one time order” of Nike products without Washington logos, however, provided to the university through one of the suppliers, Patterson said.
Washington’s ties to Nike have prompted protests from United Students Against Sweatshops (USAS), and the organization was quick to say Thursday that the committee’s letter represented a test for the university to prove its administrators’ ties to the company truly aren’t a conflict.
“If President Emmert doesn’t drop the UW’s Nike contract, I think the most lasting impact will be national attention to the UW as a case study of corporate control of a public university, since anti-sweatshop issues aren’t going away anytime soon,” Rod Palmquist, a spokesman for USAS, wrote in an e-mail to Inside Higher Ed.
Nike has been under fire from labor groups for years, but the catalytic event that’s caused such a backlash at Washington involves two of Nike’s supplier factories, Hugger de Honduras and Vision Tex, in Honduras. The Worker Rights Consortium, which counts Washington among its member universities, found that the factories closed without paying workers who were legally mandated severance totalling more than $2 million.
Nike has responded by offering training and vocational programs, but the company maintains it bears no financial liability.
“Nike is absolutely concerned for the workers in Honduras and we are deeply disappointed that the two failed sub-contract factories did not pay the workers their full severance pay,” the company said in April. “However, it remains Nike’s position that factories which directly employ workers are responsible for ensuring that their employees receive their correct entitlements and as such Nike will not be paying severance to workers that were employed by Hugger and Vision Tex.”
For Washington’s advisory committee, the response from Nike thus far has been insufficient. In its letter to Emmert, the committee said the contract should only be renewed if the workers “receive the terminal compensation owed them under Honduran law” or reach a legitimate settlement agreement.
The university’s stand on the Nike issue is “hugely important” to sending a message to the company, Godoy said.
“I would say Nike’s conduct in this case has been abysmal, and I’m not only referring to the [university conduct code] violation itself,” she said. “What I think is particularly abysmal has been their response to that situation. They’ve essentially done nothing of significance to change the situation of workers on the ground.”
June 11th, 2010
June 09, 2010, 4:39 AM EDT
By James Rupert
June 9 (Bloomberg) — Asian workers who stitch nearly all the world’s soccer balls have seen little improvement in lives dominated by poverty, a report said days before the start of the World Cup, which promises sports gear companies a sales bonanza.
Thirteen years after companies such as Germany’s Adidas AG and Nike Inc. joined labor and development organizations to end the use of an estimated 7,000 children to stitch soccer balls, “child labor continues to exist” in the three main ball-making countries of Pakistan, China and India, according a June 7 report by the Washington-based International Labor Rights Forum.
In those countries and Thailand, the fourth major ball- producer, adult workers often are paid too little to support their families. Some children still stitch balls at home, while others have migrated to new work, the report said.
“The international campaign of the 1990s removed bonded child labor from our soccer-ball industry, but these children moved to auto workshops, brick kilns and the like,” said Arshed Makhdoom Sabir, president of Ours Pakistan, a non-profit, development organization in Sialkot, Pakistan.
Sialkot is the hub of an industry that made about 75 percent of the world’s hand-sewn soccer balls in the 1990s, and still makes most high-quality balls, the ILRF report said. Adidas is marketing Sialkot-made replicas of its high-tech Jabulani, a machine-molded ball made in China for use in World Cup matches.
Sub-Minimum Wages
The labor forum’s researchers surveyed 218 workers for Sialkot companies that export balls and other products to sports retailers including Nike and Adidas, the two largest in the world. While suppliers for the two big companies provided better conditions for their workers, more than half of Sialkot’s soccer-ball stitchers reported 2009 pay that was below Pakistan’s monthly minimum wage of 6,000 rupees ($70), the report said.
For sewing together the 32 polyurethane outer panels of a soccer ball that sells for $50 in the United States, a Sialkot worker is paid as little as 50 rupees (59 cents) “so obviously international companies can make bigger profits in Pakistan,” Sabir said.
Adidas, Nike
Adidas, based in the Bavarian town of Herzogenaurach, is sponsoring the FIFA World Cup and 12 of the 32 competing national teams, in an effort to beat its 2008 record soccer- related sales of 1.3 billion euros ($1.92 billion), which was fueled by that year’s European Championship tournament. Beaverton, Oregon-based Nike is sponsoring 10 teams in the tournament, which kicks off in South Africa on June 11, as it challenges Adidas’s dominance in soccer retailing.
“Adidas believes that factory wages should always meet basic needs and also provide for reasonable savings and expenditure” by workers, said company spokeswoman Katja Schreiber in an e-mail. Adidas suppliers pay permanent workers “an average of 7,500 rupees per month, plus social benefits,” she said.
Nike “has been working to change how factories in Pakistan pay for soccer balls to shift the industry from a piece-goods system to a wage-based system,” spokesman Derek Kent said by e- mail. The company “hopes to leverage this new model and our experience to establish best practices in the industry.”
Informal Economy
While Pakistan’s economy grew an average annual 7.2 percent from 2004 to 2007, the availability of formal jobs for Pakistanis declined, said Haris Gazdar, an economist at the Collective for Social Science Research in Karachi, Pakistan. By 2008, nearly 83 percent of male workers, and 93 percent of employed women worked in the informal economy, some as soccer- ball stitchers, beyond the effective reach of minimum wage laws and most other workers’ protection rules, Gazdar said.
Seventy percent of Pakistanis stitching balls are casual workers, often in violation of a law requiring employment contracts and the status of “permanent” worker after nine months of employment, the ILRF report said.
Pakistan on June 5 increased the minimum wage to 7,000 rupees ($82) per month, although “it might need to be twice that level” to let most workers meet basic needs for the average family of seven people, said Gazdar. The World Bank estimates that a quarter of Pakistan’s 180 million people live on less than $1 a day.
China, India
Sialkot-based Awan Sport Industries Ltd., which makes balls for Adidas, and Silver Star Group, which manufactures for Nike, provided significantly better working conditions than most local ball-makers because they used more permanent employees “in formal factory settings,” the report said.
Most Chinese soccer balls are machine-made, although companies in Jiangsu province hire women and children to hand- stitch balls, according to the report. Children still sew balls by hand in the Indian cities of Meerut and Jalandhar, it said.
–With assistance from Matt Townsend in New York and Holger Elfes in Dusseldorf. Editors: Mark Williams, John Brinsley
To contact the reporter on this story: James Rupert in New Delhi at jrupert3@bloomberg.net
To contact the editor responsible for this story: Bill Austin at billaustin@bloomberg.net
June 11th, 2010
Team Sweat:
Please check out the letter below from Scott Nova, Director of the Workers’ Rights Consortium to contacts at Colleges and Universities across the United States. As you will see in the letter, KNIGHTS APPAREL is going to launch a new brand: Alta Gracia. What is most exciting about this is that the workers producing for this brand will be paid a living wage that is THREE TIMES THE LOCAL MINIMUM WAGE.
If Knights Apparel can do this, there is no reason that Nike cannot. Let’s enjoy this victory with Knights Apparel and keep the pressure on Nike. Victory will come soon my friends.
Peace, Jim Keady
To: Primary Contacts at WRC Affiliate Colleges and Universities
From: Scott Nova
Date: April 5, 2010
Re: Knights Now Ready to Launch High Standards Apparel Brand for Campus Stores
I am very pleased to report that the project to provide apparel to university bookstores that is made at a living wage and with full respect for workers’ associational rights has now come to fruition. As you know, the WRC has been working for two years with Knights Apparel, one of the largest sellers of university logo apparel, to help make this ground breaking concept a reality. As this update from Knights Apparel outlines, the company is now ready to launch its new brand: Alta Gracia.
Knights Apparel has informed us that they are now in the process of contacting campus stores that have communicated their intention to carry the product and that orders are being accepted beginning with back-to-school delivery. We also understand that limited product will be available earlier for stores that have conveyed an interest in stocking the product as soon as possible. Due to the complex nature of this initiative, it has taken longer to get to this point than we originally hoped, but we believe this innovative program was well worth the wait.
The launching of this new brand represents a vital step forward for university labor standards.
As we have previously reported, Knights Apparel and the management of the factory in the Dominican Republic have committed to pay workers a living wage, as defined by a study conducted by the WRC, and to pay a price to the factory that makes this possible. This wage is more than three times the minimum wage in the Dominican Republic and any collective bargaining will use this wage as a floor.
The payment of a living wage will have a transformative impact on the lives of workers and their families. Concrete progress on this vital issue has been a long-sought and elusive goal and we are tremendously heartened by the commitment Knights Apparel has made to this initiative.
The company and factory management have also demonstrated a strong commitment to full respect for associational rights including an open attitude toward workers exercise of these rights, an agreement to provide access to the factory for union representatives, and readiness to bargain with any duly constituted union, with Knights Apparel as well as factory management sitting at the negotiating table.
Ongoing compliance with these and all applicable labor standards will be verified by the WRC and this verification will be reflected in a tag that we have agreed to allow Knights to place on the product. Click here to see what the hang tag will look like (please note that the website referenced on the hangtag, which will provide additional information to consumers, is currently under construction).
We will be providing further information to you in the weeks ahead, including the following:
An update on the work that has been done to get the factory up and running. Knights Apparel and local management have worked from the outset with the WRC and Fedotrazonas, the Dominican union federation, on all of the aspects of the start-up process that impact workers and worker rights. As far as we know, this collaborative approach to launching a new factory is unprecedented.
A report on the hiring process. Hiring is being carried out in accordance with a fair-hiring protocol developed by the WRC and worker representatives. The WRC has monitored the hiring process closely in order to ensure compliance with the protocol and the factory has fully honored its obligations.
An outline of the exemplary approach the factory is taking to occupational health and safety. Knights Apparel is working, at the WRCs recommendation, with the Maquila Health and Safety Support Network, a US-based network of occupation health and safety professionals with unparalleled expertise and an innovative worker-centered approach to the issues.
We are very pleased that this groundbreaking product is now available to the university community. The fact that Knights Apparel, one of the leading university apparel licensees, is bringing a product to market made at a living wage, in a union-friendly factory, is a real mark of progress for university labor rights efforts. It is a pilot project, not a comprehensive solution to the challenges we face, but it is an exciting step forward and we are proud to be a part of it.
Ongoing demand is what will make this initiative sustainable. Therefore university support will continue to be vital.
As always, please let me know if you have any thoughts or questions.
Scott Nova
Worker Rights Consortium
5 Thomas Circle NW
Washington DC 20005
ph 202 387 4884
fax 202 387 3292
nova@workersrights.org
www.workersrights.org
June 11th, 2010
Team Sweat:
As you can see from the article below, Nike is projecting that their global sales will rise 40% by 2015 and revenues will hit $27,000,000,000.00. Will the workers who produce the real wealth for Nike make similar gains or will they continue to live in abject poverty while the executives, investors and athletes reap the benefits of Nike’s success?
Peace, Jim Keady
PUBLISHED BY REUTERS
* Nike sees $27 billion in revenue by 2015
* Sales from China, Converse, store unit to double by ‘15
* China is second biggest market
* Shares down 2.8 percent (Adds comments from CEO, analyst, details on expansion)
By Martinne Geller and Alexandria Sage
NEW YORK/SAN FRANCISCO, May 5 (Reuters) - Nike Inc (NKE.N) expects its revenue to rise more than 40 percent to $27 billion by 2015, helped by new stores and demand for its namesake brand and smaller brands like Converse, the athletic giant said on Wednesday.
“We’re going to continue to build, fuel and accelerate the Nike portfolio,” said Chief Executive Mark Parker, addressing a crowd during an investor day held in New York.
“Tremendous opportunity” still exists to grow the Nike brand organically, and the company will continue to launch “game-changing innovations,” Parker said.
Some $23 billion of that overall $27 billion revenue target will come from the Nike brand itself, executives said.
The world’s largest athletic shoe and clothing maker is stressing growth in emerging markets and through its younger non-Nike brands as it faces largely mature markets in the United States, Europe and Japan.
Company executives listed different businesses that would double in size within five years, from Nike’s China business to its owned stores and online unit to popular brands like Converse and Hurley, which currently have wholesale businesses worth $2.4 billion and $200 million, respectively.
The company, whose signature “swoosh” logo is recognized around the world, derives most of its profit from Nike-branded gear, but its smaller brands are among the fastest-growing, in part because they extend the reach of the athletic company.
“Think of Converse as an inspired-by-basketball brand. It drifts into other areas — into music, into rock and roll … where Nike wouldn’t go,” said Eunan McLaughlin, president of Nike’s affiliates unit.
Converse is only owned and managed by Nike in the United States and Canada, leaving room for Nike to expand earnings and revenue as it takes control in China and the U.K., he said.
Shares of Nike are up 41 percent since January 2009, but fell 2.8 percent on Wednesday.
Susquehanna Financial analyst Christopher Svezia said there was “a lot of hype” before the meeting, as many investors hoped for news regarding Nike’s retail strategy.
“People like what they’re saying but I don’t know if anybody’s getting their socks knocked off,” Svezia said. “It’s not a revolution, it’s an evolution.” He said investors may also have concerns about the costs of Nike’s planned growth.
SMALLER, FOCUSED STORES
Beaverton, Oregon-based Nike posted overall revenue of $19.2 billion in its full fiscal year ended May 31, 2009.
Parker reiterated the company’s long-term growth targets, which call for high-single-digit revenue growth and earnings per share growth in the mid-teens on a percentage basis.
Nike Brand President Charlie Denson said the growth of the middle class around the world would guide the brand to new audiences. Over 70 percent of the company’s future growth would come from outside North America, executives said, from 60 percent today.
Nike sells mainly through wholesale channels, but also operates its own fleet of stores, including 472 factory stores in 33 countries.
In an interview on the meeting’s sidelines, CEO Parker said Nike’s store expansion would focus on smaller stores instead of the very large “Niketown” stores it opened in the past.
“I don’t think you’ll see more of the … mega footprints that we have today as much as smaller footprints that we can showcase the best of the category product,” Parker said.
In addition to stores that focus on a particular brand like Nike or Converse, Jeanne Jackson, head of Nike’s direct-to-consumer business, said there would be more smaller stores focusing on a single category, like soccer or running. These include a brand-new running store in Stanford, California and an upcoming soccer store in Manchester, England.
The company expects to add between 250 and 300 Nike owned stores across the globe within five years. It is planning a related $500 million to $600 million in capital spending over that same period.
It expects the direct-to-consumer businesses — which includes its owned stores and online business — to double by 2015. It was about $2.4 billion in fiscal 2009.
Parker said the company’s cumulative free cash flow from operations should hit $12 billion by 2015. Nike will continue to grow its dividend and will spend $5 billion in share buybacks over the next five years, he said.
Nike shares closed at $75.21 on the New York Stock Exchange, down $2.14.
(Reporting by Martinne Geller and Alexandria Sage, writing by Alexandria Sage, editing by Dave Zimmerman, Gunna Dickson and Bernard Orr)
June 11th, 2010
PUBLISHED IN THE CORNELL DAILY SUN
May 3, 2010
On Thursday, the University Licensing Oversight Committee will meet to decide whether or not Cornell should continue its current relationship with Nike, given the company’s mistreatment of their workers in Honduras. The committee should end all of Cornell’s contracts with Nike until the company improves its labor practices in Honduras — where $2.2 million worth of pension payments are currently being withheld from employees by the sporting goods giant. Cornell, and other universities across the country, are in a unique position that can influence the policies and practices of companies like Nike, and improve the conditions of workers globally.
We commend the actions of University of Wisconsin which, under the leadership of Chancellor Biddy Martin (former provost at Cornell), ended its contract with Nike last week. By following Wisconsin’s example, Cornell and other universities will send a powerful message to all companies with unfair labor practices. Profit-driven corporations such as Nike will only change the way they do business when it makes financial sense to do so — if Cornell and its peer institutions chose to end their relationships with Nike, it would not only make a strong public statement, but would hit the corporation in the only place that truly hurts, the wallet.
Some in the Cornell community have been quick to show Day Hall their distaste for the University’s contract with Nike, with student groups such as the Cornell Organization for Labor Action and the Cornell Students Against Sweatshops organizing a rally on Ho Plaza this afternoon. The rally is another chance for the community to make a statement about what types of businesses Cornell should be dealing with. Regardless of one’s opinions on U.S. corporation’s use of cheap labor in developing nations, it is clear that any business who commits such an egregious contract violation (as Nike did) should not having a working relationship with our University.
This type of action has already proven to be successful. Last February, Cornell was one of many universities to end its ties with Russell Athletics, which had violated labor laws in Honduras. The financial and media pressure created by the large number of universities that severed ties with Russell forced the company to make changes to its labor practices. A month after Cornell ended its contract with Russell, the company announced it would rehire the 1,200 workers fired after they attempted to form a union, and recognize the union itself. The University’s swift action was commendable, but less encouraging is the fact that these issues seem to continually arise. Granted, Nike and Russell are two ubiquitous apparel suppliers. But, Cornell still could, and should, do a better job of looking into the business practices of the companies with which it contracts, to ensure that they are up to the standards the University sets for itself.
By severing ties with Nike, Cornell can take another step in improving the quality of life for millions of laborers around the globe. While the incident at hand is only one of many harmful and illegal labor practices that occur, addressing it sends a strong message about the University’s commitment to labor standards and sets a precedent for Nike and other companies.
June 11th, 2010
PUBLISHED IN THE SEATTLE PI
APRIL 28, 2010
Nike has been in clear and open violation of its contract with the University of Washington for over a year.
That contract requires that contractors hired by Nike to produce apparel with the UW logo abide by the UW’s “code of conduct,” which states that UW contractors must uphold the labor conditions of the countries that they work in. But last January, 2009, two factories in Honduras that produced Nike apparel with the UW logo (as well as the logo of other U.S. universities)–Hugger and Vision Tex–fired over 1800 employees without paying them the $2.6 million in severance and benefits they were due under Honduran law.
UW Professors Angelina Godoy and James Gregory wrote an Op-Ed for the Seattle Times about the violation last September, 2009 demanding that the UW require that Nike pay the workers their legally required severance. After communicating with Nike and the Workers Rights Consortium, UW’s Advisory Committee on Trademarks and Licensing (ACTL) determined on December 3 that Nike was indeed in violation of its UW contract.
On December 23, President Mark Emmert informed Nike that it is currently in violation of its contract with the UW, noting that “I believe it is important to take this opportunity to underscore the importance of the Code of Conduct and emphasize Nike’s obligation to fully comply with it. I value the University’s relationship with Nike, but I also value highly the rights of laborers in Nike’s manufacturing plants. The failure of Nike to properly respond to these current issues will inevitably jeopardize our business relationship… A continued relationship between the University of Washington and Nike is very much contingent on your appropriate resolution of this matter.” He had a follow-up meeting with Nike about his letter on January 4, 2010.
But five months later, Nike hasn’t done anything of substance to correct the violation, and the UW is refusing to hold Nike’s feet to the fire.
It’s in this context that Gina Cano and Lowlee Urquia– two Honduran workers who are owed their severance from the Hugger and Vision Tex factories– are visiting the UW Wednesday night as part of their travels throughout the country to tell their story. They will be speaking at 7 p.m. at Smith Hall, Room 102 on the UW campus. In addition to providing testimony about the working conditions in Nike factories that produced apparel for the UW or with the UW logo on it, their visit is a rare opportunity to learn about globalization–specifically about outsourcing by U.S. companies– directly from the perspectives of factory workers and not just those who presume to speak on behalf of those workers (be they businesses or non-profits). The event is sponsored by United Students Against Sweatshops, whose UW-affiliate is the Student Labor Action Project. (On May 1, Gina and Lowlee will be part of a May Day march to Nike’s offices in Portland to demand justice for unpaid workers)
But will the UW listen to Gina and Lowlee? Indeed, does it have the economic independence and moral courage to really hear what these workers have to say, let alone act on their testimony?
I’m not optimistic. Why? Because there are numerous and significant conflicts of interest within the UW administration that prevent it from adequately enforcing its code of conduct with Nike.
The office tasked with enforcing the university’s code of conduct–Creative Communications, formerly known as the Trademarks and Licensing office– not only negotiates contracts with university licensees, but is also partly sustained by those contracts, which bring in more than $1 million annually. And because the UW’s Athletics program is self-sustaining–which is to say that it does not receive funding from students’ tuition or state taxpayers–it is dependent upon UW contracts with apparel manufacturers to help finance its operations. These factors would both influence the President’s office in normal times, since part of the President’s job is to raise money from UW alumni, and many donors care a great deal about the success of the Athletics program. But during a time of recession and state budget cuts, UW dependence upon such funding becomes even more intense.
To help address this imbalance, but also to help diffuse student protests, President Emmert created ACTL–a standing university committee–to advise him on code of conduct enforcement. ACTL is a committee that was reformed after its predecessor, the Licensing Advisory Committee, dissolved in acrimony following the announcement that the UW had renewed its contract with Nike for 10 years without consulting the committee. Like its predecessor, it has no institutional power whatsoever. It has no staff, the UW is under no requirement to provide it with full and timely information about its contracts, and its recommendations to the President are entirely discretionary. Finally, its voting membership is influenced by the presence of administrators. Both Creative Communications and Athletics departments have voting members on ACTL, as does the President’s Office, giving them 3 out of 11 votes. In addition, one faculty member with voting privileges, Business Professor Debra Glassman, is married to someone who works in the apparel industry but she will not disclose to the committee who he works for.
These conflicts of interest are especially acute when it comes to the UW’s relationship to Nike. Nike has been the UW’s “sideline partner” since 1997, and in 2008 was given a 10 year extension on that partnership. In exchange for the UW placing Nike’s logo on UW sports team apparel, Nike provides the UW with free sporting equipment and apparel, along with cash payments. The total value of the current ten year contract is estimated at somewhere between $35 million and $40 million for the UW. In addition, Provost Phyllis Wise–whose job is basically Director of Operations at the UW– and Regent Orin Smith–who serves on the board that ratifies UW’s sideline partnership deals–both receive six figure compensation packages from serving on Nike’s Board of Directors (Wise began in 2009 and Smith was only began serving as a Regent this year). Even the UW’s logo was designed by Nike, and is not-so-affectionately referred to as “the weasel” by UW administrators angered by the fact that Nike inserted an upside down Nike swoosh to form the Husky’s jaw (the UW is in the process of redesigning this logo as part of its new agreement with Nike).
It’s no wonder, then, that attempts to get even token support for labor rights into the UW’s contract with Nike have proven futile. The UW announced its renewed sideline partnership with Nike in 2008 only weeks after Australian Channel 7 disclosed that Nike had been employing people in neo-slavery conditions in Malaysia– immigrants held captive against their will and forced to work for their freedom. The Board of Regents delayed its consideration of the contract for months to consider criticism of the lack of labor standards in the contract. When the Regents almost balked at approving the contract, the administration got Nike to write a special letter stating that “the University of Washington Board of Regents has NIKE’s assurance that NIKE… [will make] good faith efforts to foster compliance by its factories to with NIKE’s code of conduct, as currently written, and the Fair Labor Association Workplace Code of Conduct.” Significantly, Nike made no promise to uphold the UW’s code of conduct. But the Board of Regents endorsed the sideline partnership deal anyway.
When Professor Margaret Levi worked with President Emmert following the signing of the sideline partnership deal with Nike to coordinate higher labor standards for goods purchased by “Nike schools” in the Pac-10 and around the country, Nike gave nothing substantive and the effort fell flat, though Professor Levi continues to talk publicly about the possibility of reviving the effort.
All of this provides background for understanding the impotence of the UW to respond to Nike’s near-complete disregard for UW concerns about Nike’s violation of the UW’s code of conduct.
While President Emmert could have put Nike “on notice” that the UW would cut Nike’s contract if it failed to “remediate” its violation of its contract, he chose to issue a less-forceful, “strongly worded letter.” The UW has followed the issue closely in communications with Nike, and as more information has come to the surface showing that Hugger and Vison Tex mistreated their workers in other ways. But it has still so far shown an unwillingness to begin the process of cutting its contract with Nike.
On December 23, 2009, Nike responded to concerns raised by President Emmert and other university presidents with a letter which claimed that there had been a “miscommunication” about how much apparel Nike had produced for universities at the two Honduran factories. It also disclaimed any responsibility for the conduct or legal obligations of its contractors (since it doesn’t own the factories in question), despite the fact that this stand cuts against the codes of conduct it agreed to comply with in its contracts with various universities. And that, more or less, has been its line ever since.
Meanwhile, the Workers Rights Consortium has documented that “in the months prior to closing, Hugger and Vision Tex failed to make legally required payments on workers’ behalf to Honduras’ national health insurance program and instead illegally pocketed the deductions from employee pay that are supposed to be used for this purpose.” This is a clear violation of the UW’s code of conduct, and occurred during a time when the factories were still producing apparel for Nike.
On March 15, Nike informed the UW that beyond providing worker retraining programs for Hugger and Vison Tex workers, it would not kick in funds to ensure that the workers were paid what they are legally owed. That worker retraining program has denied interviews with the Workers Rights Consortium and local unions, however.
Yet in a show of weakness, ACTL has advised the President to not put Nike on notice for its contract violations. In a March 23 letter to Emmert, it said that “The ACTL is satisfied that Nike is making satisfactory progress in terms of disclosure although there is still far more to be done on this front and in terms of adequate facility oversight.” It went on to recommend “a delay in putting Nike on notice” so that it could gather more information from and apply more pressure to Nike, even though Nike has openly stated that it will not do anything further on this case.
In short, the UW has caved. It refuses to exercise the only power it has over Nike–the legal threat to cut its contract. Placing Nike on notice would still give Nike 90 days to comply with the order, and could reopen a dialogue that Nike has itself closed. But the UW hasn’t done it, and is making its legal contracts appear like paper tigers.
Meanwhile, the University of Wisconsin has cut its contract with Nike, and students around the country have mobilized a “just pay it campaign” to get other schools to follow suit. If the UW wants its contracts to mean anything, if it wants its contractors to take it seriously, if it doesn’t want to appear captive to big businesses like Nike, it must put Nike on notice that the UW will cut its contract if Gina, Lowlee, and their former coworkers in Honduras aren’t paid what they are due.
-Trevor Griffey
June 11th, 2010
JOBS WITH JUSTICE BLOG
By Margaret Butler, on April 28th, 2010
Last night, just a few miles away from Nike’s global headquarters, two Honduran workers spoke out strongly about how Nike’s destructive labor practices have hurt them, their families and their co-workers. Gina Cano and Lowlee Urquía testified in front of members of the Portland Area Workers’ Rights Board and a crowd of more than 100 community members.
Both women had worked in Nike-contracted factories for many years in Honduras before being laid off without notice, and without legally mandated severance pay in January 2009. “We’re here in Oregon, the home of Nike, because we want to put a face to the consequences of Nike’s behavior”, said Lowlee Urquía. “We’re saying to Nike that it is responsible every step of the way.”
The two women represented over 1,700 workers who are owed $2.2 million in severance pay. The workers are also owed health care premiums, which were deducted from their wages but never paid to the health care system. This meant that workers could not access health care in the four months before the closure. At least one worker, who had been receiving cancer treatment, died because of this denial of care, according to the worker testimony.
The two workers and expert witness Jeff Ballinger, a long-time anti-sweatshop activist, told the story of how the two plants produced Nike product for 13 years before the closure. Nike had contracted with three apparel companies, Haddad, Anvil, and New Holland Lingerie, who in turn had contracted with the two factories, Hugger de Honduras and Vision Tex. Workers at both plants started organizing unions just prior to the closure.
Nike was invited to offer their perspective, but chose not to come and testify, stating in a letter that this open community hearing was “not the most effective forum for constructive dialogue.” In correspondence with United Students Against Sweatshops, Nike claimed it did not have significant production in the two factories, and said except for one batch of orders, the plants did not produce clothing for the university market.
The two workers strongly refuted this claim. Gina Cano told the Workers’ Rights Board that, “the Nike Code of Conduct was posted all over the walls in Spanish and English.” Cano told the panel that her factory made 60 to 100% Nike apparel. Urquía testified that Vision Tex made about 80% Nike apparel. Both plants received yearly inspections from Nike auditors. Nike’s Code of Conduct binds their contractors to pay wages and benefits as required by local law. The posted Codes of Conduct were “purely decorative,” Cano told the WRB that. “They didn’t mean anything.”
Workers’ Rights Board panel members were moved by the testimony. Francisco Lopez, Executive Director of CAUSA Oregon and a Salvadoran immigrant, said, “It seems that Nike is the new United Fruit Company,” referring to the latter’s notorious exploitation of Central American workers in the 1950s. “It’s the same story, not bananas, but apparel. This is an opportunity for us to challenge Nike…all the money that [former Nike CEO Phil Knight] gives our University system is made on the backs of workers.”
The panel issued a statement finding that since Nike’s Code of Conduct binds its contractors to follow the Honduran law, it is responsible for making sure the workers are paid the severance owed them. The Workers’ Rights Board panel will seek to meet with Nike to communicate its findings, as well as issuing a report from the hearing to help educate the public about these issues. Workers’ Rights Board members and the Honduran workers will address the upcoming May Day march about these issues.
The case was brought to the Workers’ Rights Board by United Students Against Sweatshops (USAS), the national organization of college students organizing for the rights of garment workers and campus workers. USAS organizers have traveled cross-country with Cano and Urquía, as part of the campaign they’re calling “Just Pay It.”
The Portland Area Workers’ Rights Board panel was made up of Armando Gonzales, a leader with statewide MeCHA, Francisco Lopez, Executive Director of CAUSA Oregon, Joice Taylor, CEO of Global Management Strategies and chair of the N/NE Business Alliance, Deacon Marla McGarry-Lawrence of St Michael and All Angels Episcopal Church, Dr Martin Hart-Landsberg, Professor of Economics at Lewis and Clark College and Steve Novick, two-time winner of Willamette Week’s Activist of the Year award.
The Workers’ Rights Board is a project of Portland Jobs With Justice, a coalition of 85 unions and community groups working together in a campaign for workers’ rights.
June 11th, 2010
The Daily Targum
Published: Monday, April 12, 2010
Two former Nike factory workers spoke to students Sunday night in an effort to push the University to cut ties with the corporation.
Gina Cano and Lowlee Uriquia, who both worked in the Honduras New Holland factories producing Nike apparel, spoke to about 100 people on the College Avenue campus about the exploitation they experienced after creating a workers’ union. They also touched upon how Nike denied responsibility and refused to pay workers severance.
Two Honduran clothing factories closed for unclear reasons on Jan. 19, 2009, leaving about 1,700 workers without a job, health insurance and severance pay, said Zachary Lerner, president of the Rutgers Chapter of the United Students Against Sweatshops, the sponsor of the event.
“Our whole point is that everyone wants to wear Nike clothes, you just want it so that they’re not made on the backs of people,” said Lerner, a Schools of Arts and Sciences junior. “[Nike] owes the workers between $2.2 million and $2.6 million, and in revenue Nike makes $2.2 million in one hour.”
The USAS is pushing the University to cut its ties with Nike, who produces the University’s apparel. Lerner said the situation violates both the University and Nike codes of business conduct.
The women spoke of exploitative practices, like being docked fees for the health insurance and never receiving the benefits of those services.
As the situation worsened, the workers created a union. In a day, management fired many top positions in the union, including the president and vice president, Uriquia said.
The workers said they were given no reason as to why the factory closed. But with the help of the Confederation of Honduran Unions and the Workers Rights Consortium, they pressured management to speak up, she said.
Uriquia said the workers were told the factories closed because they were no longer getting orders due to the economic crisis in the United States.
Cano, a union organizer, was hired at New Holland after Hugger de Honduras closed. She was fired two weeks into the job once management looked into her organizing background, she said.
“The probationary period at any factory is two months, and they gave me no kind of explanation as to why they were firing me,” Cano said. “Because we are part of this fight, because we’re in this struggle, both of us have been discriminated against. We’ve both been blacklisted.”
She said factories tend to prioritize individuals for hiring, mostly women between the ages of 18 and 25 who have never worked in these kinds of factories and do not know their rights.
According to an April 8 article in the Cornell Daily Sun published, Nike said they already did things they were not required to do regarding sub-contract workers, like providing training programs.
“It is not [our] responsibility to take care of sub-contract workers,” a Nike official said in the article.
The fundamental reason USAS says sweatshops exist is because companies like Nike, Adidas and Reebok abuse the power that they have in a global economy, said International Campaign Coordinator for USAS Rod Palmquist.
Sixteen supporters of the movement to end University ties with Nike approached University President Richard L. McCormick earlier in the semester, demanding he cut the contract due to labor rights violations. McCormick sent a letter to Nike and said he would look into it again at the end of the semester.
Lerner noted the University of Wisconsin cut their contract with Nike last Friday and said the University should follow in their steps.
“We need to do something right now. It can’t just be something we wait on,” he said.
The two women have been speaking as part of a national tour. They have previously spoken at universities such as Duke, Cornell, Brown and the Universities of Florida and Maryland.
The night ended with an outdoor candlelight ceremony with tea candles spelling out the words “Just Pay It,” though they were never lit due to weather and police enforcement restrictions.
School of Arts and Sciences first-year student Brett Kozinn said he would still wear Nike even after attending the event.
“[By] me not wearing Nike, [it] isn’t going to have a huge effect on this kind of thing,” he said. “I’m more inclined to get involved in something like this now, but not wearing Nike isn’t going to give those people their severance.”
 "Photo: Brian Bezerra")
 "Photo: Brian Bezerra")
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