Video: Are Nike’s factory workers paid a living wage?

October 20th, 2011

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NIKE’S INDONESIAN WORKERS ARE STILL PAID A POVERTY WAGE

January 31st, 2011

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Team Sweat:

After a day of settling in and enjoying some of the sights of Jakarta (national monument, national mosque, etc.), this evening I had my first meeting with a Nike factory worker during this trip. This particular worker is a long-time friend and colleague of mine in the struggle for justice for Nike’s workers in Indonesia. Our conversation was one of the most productive I have had in my more than 10 years of working on this issue.

We sat around a table at a hotel in Jakarta, ordered some coffee, tea, and french fries and got right down to brass tacks.

Workers at this particular Nike shoe factory are currently being paid Rp.1.243.000 ($138) per month for their basic wage. Along with their salary, they receive transportation to and from the factory by one of two means - there is a company bus provided for them or if they do not live on the bus route, they receive a transportation allowance of Rp.10.000 per day. They also receive one meal at the factory or if a meal is not provided, they receive a meal allowance of Rp.4.500 per day.

I also learned that workers are able to earn marginally more than the basic wage via the company promotion system. When a worker starts out at the factory, they are considered at “Level 1″ and are paid the basic wage of Rp.1.243.000. They are then assessed after three months. If they meet their production targets and their attendance is good, they will be promoted to Level 1A and for this they receive an additional Rp.16.000 per month in pay. They will be evaluated in another three months and if they pass, they are promoted to Level 1B and they receive an additional Rp.5.000. There are levels 1A to 1F and then they hit Level 2 that also goes from 2A through 2F.

Here is a breakdown of the entire promotion system.

Level 1 Rp.1.243.000
Level1A Rp.1.259.000
Level 1B Rp.1.264.000
Level 1C Rp.1269.000
Level 1D Rp.1.274.000
Level 1E Rp.1.279.000
Level 1F Rp.1.284.000
Level 2 Rp1.303.000

Level 2A Rp.1.308.000
Level 2B Rp.1.313.000
Level 2C Rp.1.318.000
Level 2D Rp1.323.000
Level 2E Rp.1.328.000
Level 2F Rp.1.333.000

So, the maximum salary that a operational level worker (sewing, cutting, assembling…) can make is Rp1.333.000 ($148) per month. To earn this salary, working in production groups of 250, cutting, sewing and assembling the shoes, workers produce 900 pairs of sneakers in 8 hours, that is 112.5 sneakers per hour or 1.875 sneakers per minute.

Let’s take a worker who is making the maximum (Level 2F) and see what they can afford for their toil on the production line.

They start the month with Rp1.333.000.

Rent = Rp.200.000
Transportation (beyond work-related travel) = Rp.600.000
Drinking Water = Rp.110.000

If you add up these three major expenses, they are Rp.910.000. Subtract the Rp.910.000 from Rp.1.333.000 and you are left with Rp.423.000. Divide that Rp.423.000 by 30 days and you have Rp.14.100 to spend each day on food, clothing, soap, toothpaste, education for your kids, and anything and everything else one might need to have to feel like a full human being.

Well…

One meal of rice, vegetables and a piece of chicken are going to cost you Rp.8.000 at the local food stall. A bottle of locally made iced-tea would cost you Rp.3.000. A snack of two bananas would cost you Rp.6.000.

You do the math.

Seriously, take a moment and do the math.

I asked my friend what a living wage would be for a Nike factory worker in the area where he and his fellow workers live. He said that for a worker that is single, it would be Rp,3.500.000 per month ($387) and for a worker supporting a family of four, it would be Rp.4.500.000 ($498).

I shared with him that to make this happen, to be able to pay Nike’s Indonesian workers a living wage, it would only be an additional $5 in production costs for a pair of sneakers. I told him that there are tens of thousands of consumers in the United States and around the world that will support workers if they make this demand of Nike. I also shared that it is imperative that we expose the lies that Nike tells the world about workers’ wages (Ex. Phil Knight stating that Nike factory workers are “absolutely” paid a living wage, “no, question about it.”)

He agreed, and tomorrow afternoon, after my morning panel discussion with the Jakarta Foreign Correspondents Club, he will go on camera and tell his story to the world. He has also agreed to set up meetings with workers from other factories to get their stories and the truth on the record. Stay tuned.

He did express to me that many of his fellow workers are still afraid to speak up and demand the justice they deserve. To let them know that there is support for them around the world, can you take a moment and write a comment to this note? Please tell Nike’s workers in Indonesia that you stand with them in solidarity!

Peace (and Justice), Jim Keady

ALTA GRACIA BRAND TO PAY WORKERS A LIVING WAGE = THREE TIMES THE LOCAL MINIMUM WAGE

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

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