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Open letter to Nike

15 March 2000

Dear Mr. Knight,

We were among the groups who wrote to you in September regarding labour abuses in your suppliers' factories (refer http://www.caa.org.au/campaigns/nike/exchange.htm ).

We received replies from you and from Nike's Director of Labor Practices (Mr. Dusty Kidd) in October. We are now writing to respond to those letters. This letter will deal with the content of Mr. Kidd's letter and a separate letter is being prepared which will respond to your proposal that we select representatives to meet with Nike.

We believe that Nike's response to the issue has been dictated by public relations concerns rather than a genuine commitment to protecting workers' human rights and that Nike has deliberately avoided taking steps which would ensure that the labour rights of Nike workers are protected.

Our obsession with the past

Your letter suggested that we "continue attacking Nike based on an unchanging list of past incidents" and although he recognised that issues from the past remain important Mr. Kidd's letter stated that "the focus of Nike's Labor Practices department necessarily is on the present and the future". Many of the labour abuses described in this letter and in our original letter are ongoing, but it is true that some of the cases raised occurred as long ago as 1998. We believe it is important to continue pursuing these cases for several reasons. First, they have not been rectified and continue to cause hardship to the workers involved. Second, cases like the dismissal of workers at the Sam Yang factory in Vietnam send a clear message to other workers - if you speak out about conditions in your factory you will lose your job. Third, these cases are an indicator for us of whether Nike is genuinely committed to respecting workers' human rights. On what basis are we supposed to believe Nike's broad policy statements when we have clear evidence of particular cases where your company refuses to put those policies into practice?

Covering all the issues

Mr. Kidd claims that our letter was helpful because: "In six pages you summarized what seem to be the most important issues you individually and collectively have with Nike with respect to labor practices. If that is not the case, please send along an amendment so we can fully review and respond to all the current issues you wish Nike to address".

It is true that our first letter covered most of the concerns we have at a broad policy level with Nike's labour practices. It is not true that it covered all the abuses in individual Nike contract factories which we believe to exist. As our letter indicated, we have the resources only to research conditions in a very small number of these factories and in many countries where Nike chooses to source production it is difficult and dangerous to meet with workers. Whenever we do manage to have such meetings, almost inevitably workers describe exploitative factory conditions. This leads us to believe that labour abuses are the norm in your suppliers' factories and not isolated incidents as Nike has frequently suggested to the media.

Nor did our letter include all the labour abuses in Nike factories of which we are currently aware. Human rights organisations in several other countries are in contact with workers suffering as a result of labour abuses in Nike factories but those organisations are unwilling for those concerns to be made public in case those workers are dismissed for passing on the information.

Nonetheless we are able to include in this letter new information regarding the results of a survey of workers from 11 different Nike contract factories in Indonesia as well as new evidence of labour abuses in factories producing for Nike in Bulgaria, China, Cambodia, Indonesia, Thailand and the USA.

NEW EVIDENCE OF LABOUR ABUSES IN NIKE CONTRACT FACTORIES:

Compulsory overtime, humiliating treatment and extreme verbal abuse - the recent survey of 3,500 Nike Workers by the Urban Community Mission in Jakarta

Between 10 September and 18 October 1999 the Urban Community Mission in Jakarta worked with workers themselves to survey 3,500 workers from 11 different Nike contract factories (Pt. Nikomas Gemilang, Pt. NASA, Pt. Starwin, Pt. Adis, Pt. Doson, Pt. Citra Abadi Sejati I & II, Pt. Dayup Indo, Pt. Tuntex Cikupa, Pt. Tuntex Cakung, Pt. Konaan and Pt. Bintang Adi Busana). The survey results show that abusive management practices remain widespread (refer <http://www.summersault.com/~agj/clr/alerts/crueltreatmentworkingfornikeinin donesia.html>).

More than 2,000 workers (57% of respondents) indicated that they had seen workers being shouted at or mistreated by supervisors or managers. Examples of verbal abuse given by workers included the Indonesian equivalent of phrases like "Fuck You!" "You Idiot!", "You Whore!" and "You Pig!". Examples of mistreatment included wage deductions, having their ears pulled, being pinched or slapped on the buttock, being forced to run around the factory yards and having to stand for hours in factory yards (being "dried in the sun"). Workers also complained that they are forced to work excessive amounts of overtime, that it is often extremely hot in work rooms, that access to drinking water is limited and that they receive very low wages.

Evading responsibility while workers cough up blood on the production line

- Nike and the Par Garment Company in Thailand

We have made it clear that whenever we publish cases of labour abuses in Nike factories we are not calling on Nike to end its relationship with that supplier but rather to work with the factory to rectify the problem. Cutting orders hurts the workers who have had the courage to reveal conditions in their factories, and sends a clear message to workers in nearby factories that if they speak out Nike may cut orders and take away their jobs.

Mr. Kidd's letter seemed to indicate that Nike supports this principle, but Nike's practices in relation to the Thai factories owned by Par Garment Co. Ltd. have been very different.

Research by Junya Yimprasert and Christopher Candland (refer http://www.web.net/~msn/3nike18.htm ) summarises the history of this company, which is notorious for underpaying workers, requiring extended shifts of up to 12 hours a day, failing to put in place welfare provisions required under Thai labour law and laying off regular workers in order to sub-contract production to smaller sweatshops.

In 1997 Par Garment attempted to close down its factory in Rangsit as a means of crushing the factory union. This lead to a 6 month sit-in protest by workers at the factory, supported by international organisations. Eventually (in April 1998) the Thai government stepped in and mediated a settlement. A month after the factory reopened the 5 union committee members (including the main protest organiser, Ms. Suthasinee Kaewleklai) and 24 other workers were fired for organising the protest. A local NGO is assisting the workers to take their case through the Thai court system, but it will be at least another year before they know the outcome of an appeal to the Supreme Court. Meanwhile Suthasinee's public profile during the sit-in protest has made it impossible for her to get a factory job in the Rangsit area and many of the other fired workers are struggling to survive on very low incomes from casual and unstable work.

Nike had been a customer of the factory at Rangsit until the sit-in protest in 1997. When the factory re-opened in April 1998, rather than work with the factory to ensure that workers' right to organise was respected, Nike stopped ordering from the factory. According to Young Christian Workers (a local Thai NGO) management of the factory at Rangsit repeatedly told the workers that Nike did this because the union members tainted the image of Par Garment to the press. This reasoning was then used to hold the union members responsible for workers being laid off following the loss of the Nike contract.

We call on Nike to restore its ordering relationship with the Par Garment factory at Rangsit and to work with other companies ordering from Rangsit to ensure that Suthasinee Kaewleklai and the other workers who were fired for union organising are offered their jobs back and that all workers in the factory are freely allowed to engage in union activities. The fired workers should also be properly compensated for the hardship which their dismissal has brought. The union committee members are asking that the Par Garment factory pay each of them 100,000 Baht ($US2,600*) in back compensation.

Nike has maintained an ordering relationship with two of Par Garment's subsidiaries, the Par Monthinee factory in Nakorn Rachasima (Korat) and the Par Consortium factory in Ubon Ratchatani (both provinces in North Eastern Thailand). Karuna Durian and Piya Pangsapa recently interviewed a worker currently employed at the Monthinee factory. Their report (see Appendix 1) indicates that there is extensive forced overtime and that workers are paid at a piece rate so low that they must work at very high intensity. The factory also refuses to pay sick leave - putting pressure on workers to work even when they are sick. Overall physical exhaustion has caused some workers to cough up or vomit blood while they work on the production line.

Nike should ensure that health and safety and human rights standards (at the very least those included in Nike's code of conduct) are maintained at Par Monthinee and in all Thai factories with which Nike places orders.

Cancelling orders in response to worker activism? - Nike and the PT Tainan I factory in Indonesia

The Par Garment factory at Rangsit is not the only factory in which workers claim that Nike has cancelled orders in response to worker activism. The Urban Community Mission in Jakarta has passed on to us details of the case of Sumardy and Wahyono, two union officials who were fired from the PT Tainan I factory (in Cakung near Jakarta) in 1998 following their role in a successful industrial action. According to Sumardy, Nike pulled its orders from Tainan I following the industrial action which lead to his and Wahyono's dismissal. Sumardy and Wahyono are still campaigning for their reinstatement.

Three years later, what's changed? - Nike and the PT Feng Tay and PT Kukje factories in Indonesia

In 1996, Dr. Peter Hancock (now at the School of International Development Studies at Deakin University in Melbourne) interviewed workers from two Nike factories in Banjaran, PT Feng Tay and PT Kukje, as part of his Ph.D. thesis on factory conditions in West Java. He found that the two factories supplying Nike were amongst the worst in Banjaran in terms of working conditions, wage rates for overtime, non-payment of legally required benefits and denial of sick leave. In the Feng Tay factory workers averaged 11.5 hours work a day and most were required to work seven days a week. Supervisors had been trained in the systematic abuse of the predominantly female workforce using the Indonesian equivalent of phrases such as "Fuck you!" and "Move you stupid bitch!"

The results of this initial study were published in the magazine Inside Indonesia. Early in 1998 Hancock learned that Nike had used the article as a reason for cancelling its contract with the Kukje factory. Nike claimed this decision was evidence of its commitment to its code of conduct, but Hancock points out that conditions in the Feng Tay factory were far worse than in Kukje and so if Nike's decisions to cancel orders were genuinely based on its code then Nike would have severed the relationship with Feng Tay first. The general manager of Kukje was so angry at the loss of the relationship with Nike that he called in government officials to Banjaran to investigate which workers had spoken to Hancock. Fortunately interviews had been confidential and no workers were punished as a result of these investigations.

In November 1999 Hancock returned to Banjaran to conduct a follow-up study and the results of this research will be published in Inside Indonesia this year. The Feng Tay factory is still producing for Nike. Workers at this factory are still being required to work excessive overtime, with the workers interviewed averaging 64.6 work hours per week and often being required to work on Sundays. Workers are now being paid slightly above the legal minimum wage and are receiving the legally required rates for overtime, but wages for a standard 40 hour week are still below what workers require to meet their basic needs.

The Kukje factory is currently without direct orders from Nike but it still makes some Nike shoes under contract from Feng Tay and Feng Tay is looking to take over the factory. The Kukje workers interviewed work an average of 57.2 hours per week but their average monthly pay (including overtime pay) is so low (330,000 Rp. or $US45*) that Kukje is clearly paying them for overtime at an illegally low rate.

Hancock reported that workers in both factories were scared of losing their jobs and had been warned not to discuss their employment with researchers.

Harassing workers who dare to organise - Nike and the Natural Garment Factory in Cambodia

In September 1999 Cambodian Labor Organisation (CLO) prepared a report on the Natural Garment Factory in Phnom Penh which takes orders from Nike (see Appendix 2).

The factory has a democratically elected workers' organisation (the Democratic Union of Tien Yien - DUTY) but it has not been allowed to carry out its proper role. CLO's report describes how, during a period when the factory was producing for Nike (April to July 1999), the DUTY Union President Miss Ken Chheng Lhang suffered extensive harassment for trying to defend the workers' right to have one day off in every seven. It also describes how on 6 July 1999 factory supervisors manufactured a problem with the work of DUTY union treasurer, Chab Kunthea, as a pretext for firing her. At least one supervisor has reportedly told her work group that she "will destroy" any member of the group who becomes a union member.

The management of Natural Garment is going to great lengths to try and crush the DUTY union. Nike should ensure that DUTY union treasurer, Chab Kunthea is reinstated and insist that all harassment of union leaders is brought to an end.

Only disclosing the addresses of model factories? - Nike and the Hung Wah garment factory in China

In the US a growing student anti-sweatshop movement is putting pressure on Nike and other companies to publicly release the addresses of factories producing clothes bearing university logos. Nike has responded by publicly releasing the addresses of factories producing for ten US universities - Arizona, Duke, Georgetown, Michigan, Carolina, Penn State, Oregon, Maryland, Cal State and Indiana.

Nike only released the addresses of three factories in China, all owned by the same company (WDI). In November 1999 staff of the Hong Kong Christian Industrial Committee (HKCIC) interviewed workers from those factories as well as workers from another factory, the Hung Wah garment factory, which also produces for Nike in China. The results of the research have been published in the February 2000 issue of HKCIC's newsletter, CHANGE.

Conditions in the factories which Nike had disclosed were relatively good. There was a basketball court in each factory and workers indicated that they were satisfied with the food and accommodation made available to them. Most workers put in 8 hour days and were only rarely required to work overtime, although workers in the computerised stitching section were working 12 hour days and were allowed only one day off every 12 working days. Workers did not know what a trade union was, but said that there was a workers' organisation selected by management which held monthly meetings.

Conditions in Hung Wah were very different. Workers reported that factory food was of poor quality and that they lived 12 to a room in cramped factory dormitories with barred windows. They were required to work 12-and-a-half-hour days, seven days a week and were only allowed one day off per month. During peak periods they were sometimes forced to work through the night. One month's wages was being withheld by management as a deposit to discourage workers from resigning and overtime work was being paid at illegally low rates. None of the workers interviewed at Hung Wah had heard of Nike's code of conduct.

On the basis of this research HKCIC suggest that Nike has only released the addresses of model factories in China. In response Nike has insisted that it has released the addresses of all factories producing for those ten Universities. This may well be the case, but it does not allay suspicions that before releasing these addresses Nike may have arranged its production for these universities so that it takes place in relatively good factories. According to Nike's website, production for US Colleges amounts to less than one per cent of Nike's business and those ten universities no doubt account for significantly less than this. When such a small percentage of Nike's factories is involved it would be relatively easy for Nike to arrange its production in this way. We call on Nike to remove such suspicions by publicly disclosing the addresses of all its suppliers.

No better at home? - Nike and the J.H. Design Group in Los Angeles

The US organisation Sweatshop Watch is distributing a sign-on letter on behalf of eight garment workers who filed a court case against J.H. Design Group in Los Angeles in November 1999 alleging that they were employed under working conditions that contravened US law. Between 1991 and 1999 these workers sewed jackets for a number of companies including Nike. According to the workers they were paid less than the minimum wage (as little as $US3.00 per hour) and were forced to work long hours, often having to take work home. They were subjected to harassment and intimidation and some workers were illegally fired for speaking out about sweatshop conditions. Sweatshop Watch is calling on Nike and the other companies who placed orders with JH Design Group to ensure that these workers are paid the wages they are owed plus damages for the abuses they endured.

Back-breaking quotas - Nike and the Savina factory in Bulgaria

The German Clean Clothes Campaign has prepared a short report on conditions in the Savina factory in Sandanski in Bulgaria which produces sportswear for Nike and Adidas (refer http://www.cleanclothes.org/companies/savina99-11.htm ) The report is based on visits to the company in April and November 1999. According to the report most of the women working at Savina are young mothers. Due to the very high levels of unemployment in Bulgaria they are also often the sole breadwinner in the family. The factory has a history of paying low wages and requiring excessive overtime but following a strike in the Spring of 1999 (organised by the union KT Podkrepa) the workers managed to negotiate a 9 hour work day, less half an hour for lunch. Unfortunately workers are still paid on the basis of a quota system and their pay depends on fulfilling that quota. The quotas were variously described by workers and union officials as "murderously high" and "back-breaking". Although workers are not directly prevented from organising unions, many conceal their union involvement for fear of losing their jobs. The factory owner, Hristos Karanidis, told one of the researchers in anger that he was considering leaving Bulgaria because of the union presence in the factory. Workers were unaware of the existence of Nike's code of conduct.

Nike should ensure that workers in the Savina factory are freely able to organise and that your company's suppliers do not punish workers for organising by closing down their factories and moving the production elsewhere.

Working right through the night - Nike and the Lian Thai factory in Thailand

Esther de Haan from the Clean Clothes Campaign in the Netherlands met with three workers from the Lian Thai factory in Thailand in November 1999. Her notes on the meeting are in Appendix 3. Workers at the factory receive 162 Baht ($US4.25*) when they work standard 8 hour days and say they need about 200 Baht ($US5.25*) just to cover the basic needs of one person. About half of the workers, mostly women, have families and in many cases they are the sole breadwinner as their husbands have been laid off. Work starts at 8am and workers are commonly required to work until 11pm and sometimes even later, depending on the orders. At times they have to work throughout the night, in which case they get half a day off the next day. Most workers also work on Saturday and Sunday. If they refuse overtime a few times they are never offered any overtime again.

This factory is unique amongst factories we have investigated in that workers say they do feel confident to tell the truth about their working conditions to Nike representatives. However, workers complained that Nike representatives had not taken any steps to address those problems which workers had described to them. This factory is also highly unusual in that there is an independent union. Union members have suffered considerable discrimination in the past but now report that things are "working better".

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