4. Labour conditions *32)
One and a half years after Nike CEO Phil Knight announced
six "new" labour initiatives, it seems that not
much has changed regarding labour conditions for the workers
producing sportswear and shoes for Nike. Nike's corporate
responsibility goals make no mention of wage requirements,
support for organising and collective bargaining, or limits
to overtime work. Although some improvements have been made
on health and safety, it is clear that on this and other issues
much work remains to be done.
Workers in Nike's suppliers' factories continue to be overworked
and subject to abusive management practices. Workers who speak
to journalists about conditions in their factories or try
to organise unions to defend their rights continue to be systematically
humiliated and dismissed. Wages in Nike's suppliers' factories
remain unconscionably low. In Indonesia, employees of clothing
suppliers are expected to work in excess of 65 hours a week
and yet are struggling to survive on less than $US1 a day.
4.1 Wages
According to Nike's Code of Conduct: "The manufacturer
pays each employee at least the minimum wage, or the prevailing
industry wage, whichever is higher." In a statement by
Nike's Dusty Kidd; "Nike is doing all we can to ensure
that the 500,000 people around the world who manufacture our
products are paid a fair wage." *33)
But is a fair wage the same as the minimum wage which Nike's
Code of Conduct requires its suppliers to pay? The minimum
wage is often set very low to attract foreign investment and
is therefore mostly insufficient. Or is a fair wage a wage
that workers can actually live on? Numerous reports and research
into labour conditions for Nike's workers paint a gloomy picture
of the wages actually paid.
Indonesia
Indonesia 'economic crisis has caused a steep rise in inflation
and a drastic fall in the value of the rupiah. In response
to appeals from campaign groups, Nike required its Indonesian
sport shoe contractors to increase wages above the legal minimum.
In the factories where this policy has been implemented, workers'
capacity for dealing with the extreme deprivations caused
by the crisis has been improved. Nevertheless, the fall in
the value of the rupiah has been so great that these higher
wages are still less, in US dollar terms, than workers were
being paid before the crisis. The wage increase has not been
extended to clothing contractors. In December 1998 Tim Connor,
of Community Aid Abroad, met with a number of workers from
two of Nike's Indonesian footwear suppliers, PT Lintas and
PT Astra Graphia Tbk (Adi). Although Nike had announced the
wage increases several months before, workers in those factories
were still only being paid the legal minimum, and workers
at PT Adi were not even being given wage slips.
El Salvador
At the end of 1998, Julia Pleites told the consumers in the
United States that when she was working in the Formosa factory
in El Salvador, she was only able to afford to buy milk for
her daughter once every month. She was working 12 hours a
day and living in one tiny room with her mother and her daughter.
Workers who could not reach the production target during normal
working hours had to work extra hours, without getting any
additional payment. *34)
Vietnam
Research conducted by the Interfaith Centre for Corporate
Responsibility in 1998 indicates that wages paid by Nike's
suppliers' shoe factories in Vietnam are barely adequate to
provide a nutritious diet. According to that research, a worker
who bought food from the cheapest market would still have
to work more than a day to be able to afford to buy one kilogram
of chicken, and half a day to buy a dozen eggs.
In May 1999, researchers from the Hong Kong Christian Industrial
Committee and the Asia Monitor Resource Centre interviewed
workers from the Sam Yang factory. The workers indicated that
their wages were inadequate to cover their living expenses,
they were unable to save, and at times they had to borrow
money from their families. They also told the researchers
that if workers are late or "do something wrong"
money is deducted from their wages as a penalty and they are
sometimes hit by their supervisors - usually with bare hands
but occasionally with rods. Workers told of one case where
a worker had been hospitalised after a beating from a supervisor.
Many poorer countries deliberately set the minimum wage
well below what would be adequate to cover workers' needs
in order to attract and keep foreign investors. Like other
multinational corporations, Nike has actively encouraged this
by continually moving production to lower wage countries.
Last year, Nike announced to the business press in the Philippines
that it would have to cut its production in either the Philippines
or Thailand (where the minimum wage is higher than in most
other countries in Asia). Despite attempts by the Philippino
government to convince Nike to stay, Nike drastically cut
orders to its Philippino suppliers, putting hundreds of people
out of work. *35)
In some cases, Nike workers are not even paid the minimum
wage. Evidence from workers at the Par Garment factory in
Thailand indicates that much of the production from that factory
is subcontracted out to smaller sweatshops where workers are
paid below the minimum.
A living wage would be sufficient to meet basic needs
and provide some discretionary income. Doubling Nike's Indonesian
workers wages from 10 to 20 cents/hour would cost the company
$20 million/year; the equivalent of what Nike spent on its
sponsorship of the Brazilian soccer team, and less than 3%
of Nike's annual advertising, according to a September 1998
wage study by Medea Benjamin. *36)
4.2 Overtime
Nike's Code of Conduct states that the manufacturer should
use "overtime only when each employee is fully compensated
according to local law; informs each employee at the time
of hiring if mandatory overtime is a condition of employment;
and, on a regularly scheduled basis, provides one day off
in seven, and requires no more than 60 hours of work per week,
or complies with local limits if they are lower." 60
hours is already quite a long working week. Again, numerous
examples show that in many factories, workers are required
to work far longer hours.
Vietnam
Ms. Lap Nguyen was a section leader with three years' experience
at the Sam Yang factory in Vietnam and had received awards
for her skill and commitment. She was required to work over
100 hours' overtime during February and March 1998. In February
and March 1998, several workers from the factory, including
Ms. Lap, were interviewed by the US sports channel ESPN. They
described problems at the factory, including the use of violence
by security guards towards workers. While working overtime
on Sunday March 29, Ms. Lap became sick (feverish) and put
her hands on her head to rest. Her manager hit her on the
arm. She went home, obtained a doctors' certificate proving
she had fever and took one and a half days' sick leave. On
her return to the factory, her manager shouted at her and
demoted her from team leader to machinist on the ground that
"section leaders can't take sick days." In the next
few days, the supervisor continued to switch her from one
job to another and deliberately humiliated her in front of
other workers. During this time, the factory manager interrogated
her about her interview with ESPN three times, using words
like "we know what you have been doing behind our back,"
"confess now and you will be able to keep your job."
The factory manager demoted her to cleaning the toilets and
continued to harass her. Eventually she was asked to sign
a letter of resignation, decided that she could no longer
take the harassment and intimidation and signed.
Indonesia
"When the company was booming, we were forced to work
overtime," said Nurkarim, a 24-year-old worker at the
Nikomas factory in Tangerang, near the Garuda plant. "Now
that the company is in trouble, we don't work that much, and
we're not paid that much, either," said Nurkarim. "
…But the situation is worse because all the prices have
gone up." *37) Targets are set
very high, and several group leaders were punished and made
to clean the bathroom because they did not achieve their targets.
In most of the factories producing sports shoes in Indonesia
it seems the workers have to work more than 72 hours. At the
Nikomas facility, a worker had to work 12-hour shifts from
Monday to Friday from 07:00 - 19:00 or from 19:00 - 07:00.
On Saturdays, the work hours were from 07:00 - 17:00, while
on Sundays the work hours were from 07:00 - 12:00. *38)
Only in August 1999 were the workers of PT Tuntex Balaraja
not obliged to work overtime: orders were too low. After this
relatively quiet period, however, workers were required to
move at the usual pace in order to meet targets. Working hours
can be as much as from 07.30 to 02.30.
Overtime must be voluntary, should not exceed 12 hours
per week, must not be demanded on a regular basis, and must
be compensated at a premium rate.
4.3 Right to organise and collective bargaining
"NIKE seeks partners that share our commitment to the
promotion of best practices and continuous improvement in:
(.) Management practices that recognise the dignity of the
individual, the rights of free association and collective
bargaining, and the right to a workplace free of harassment,
abuse or corporal punishment", states Nike's Code of
Conduct. Nike adds "Our manufacturing partners must post
this code in all major worksplaces, translated into the language
of the worker, and must endeavour to train workers on their
rights and obligations as defined by this Code and applicable
labour laws." It seems, however, that in most countries
where Nike makes its clothes and sport shoes, there is a hostile
and severely repressive attitude to trade unions. *39)
Indonesia
In September 1998 PT Lintas in Indonesia dismissed Haryanto,
a union official who had been distributing Nike's own Code
of Conduct to workers producing for the company. The local
human rights group Sisbikum believes that Haryanto was fired
because of his union activities. Sisbikum representatives
approached Nike's office in Jakarta and asked them to implement
Nike's promise to protect the right of workers to organise.
They were told that Nike couldn't intervene in the internal
affairs of its suppliers. It has taken an outpouring of international
pressure and an international speaking tour for Haryanto to
be re-instated in January 2000.
El Salvador
Workers at Formosa were beaten and intimidated and earned
subsistence wages, according to the testimony by a worker
at Formosa, Julia Pleites, in October 1998. Applicants for
jobs in the factory were asked, in the forms they have to
fill in, whether they are or were a member of a trade union.
A 1999 report by the standards firm Verité confirms
that this situation still exists and that workers cannot freely
form unions. Trade unions are systematically repressed. Many
interviewed workers cited incidents in which colleagues had
been dismissed for trying to organise. Failure to uphold the
right to form unions violates local laws (Article 204 of the
El Salvador labour code, which stipulates freedom of association).
Thailand
Between 1988 and 1990, about 500 workers, mainly women, were
employed at the Par Garment factory. In 1990, after a dispute
with management, the workers formed a trade union in 1990.
During 1991 and 1992, two additional companies were set up,
and the company internally sub-contacted more and more of
the work to the workers of these new factories which would
receive only the minimum wage and no additional benefits.
When in 1995, the workers from the 3 factories joined together
and went on strike for better working conditions, half of
the workers were fired. A large number of workers have continues
to be laid off since 1995. But the company is doing well,
sub contracting more and more production to factories in the
neighbourhood where no unions are active. Many of the workers
who were laid off now have to turn to these factories and
work for a lower wage, with a lot of overtime and without
the support of a union.
The repression of trade unions and their activities violates
international standards and the FLA standards *40)
to which Nike is "committed." The right of all workers
to form and join trade unions and to bargain collectively
must be recognised (ILO Conventions 87 and 98). Workers' representatives
must not be the subject of discrimination and must have access
to all workplaces necessary to enable them to carry out their
representation functions (ILO Convention 135 and Recommendation
143). Employers must adopt a positive approach towards the
activities of trade unions and an open attitude towards their
organisational activities.
4.4 Health and Safety
In the last year, Nike has made positive changes in the areas
of environmental health and safety. In 1998, it announced
a program to replace petroleum-based solvents with safer water-based
compounds. In 1999, an independent expert was allowed to verify
that this was happening at the Tae Kwang Vina facility in
Vietnam. The investigator found that the factory had substituted
less harmful chemicals in its production, installed local
ventilation exhaust systems, and trained key personnel on
occupational health and safety issues. The report concluded
that the factory had implemented important changes that significantly
reduced worker exposure to toxic solvents, adhesives, and
other chemicals. It also noted that significant health and
safety issues remained unresolved. Workers in some sections
of the plant still had to contend with over-exposure to hazardous
chemicals, and with excessive heat and noise levels. Respiratory
illness rates remained a concern. The report observed that
further steps were needed to bring this factory into compliance
with U.S. Occupational Health and Safety Administration (OSHA)
standards, as Nike had pledged to do. In a move indicating
a new level of openness on Nike's part, the same investigator
was invited by the company to look at health and safety issues
in any of Nike's shoe factories. Plans are underway to do
this in several factories in Indonesia and China. *41)
Research released in July 1999 by the Hong Kong Christian
Industrial Committee indicated that one of Nike's suppliers'
factories in Jiaozhous City (owned by Qingdau Sewon Shoes
Co. Ltd.) had inadequate fire safety. The factory has anti-theft
cages on all the windows, blocking one of workers' main escape
routes in the case of a major fire. Workers in that factory
are expected to work until 2 or 3 a.m. during peak periods,
and it is extremely dangerous for women workers to travel
home when they finish at this time.
*32) much use has been made of the international
letter that has been sent to Nike on September 22, signed
by 45 organisations which can be found at http://www.cleanclothes.org/companies/nike.htm,
and the answer by Nike, dated 5 October 1999 which can be
found at: http://www.nikeworkers.com/labor/cleancl_let.shtml
*33) Letter by Dusty Kidd, on October 6th in response to the
above mentioned letter
*34) Formosa casefile for the Euro2000 campaign can be ordered
from the Clean Clothes Campaign
*35) Tim Connor, 22 October 1999, personal e-mail
*36) Medea Benjamin, "Wages and Living Expenses for Nike workers
in Indonesia", Global Exchange, San Francisco, September 1998
*37) An article by Richard Read, on the Nike International
mailing list of 21 June 1998
*38) e-mail to the Nike International mailing list on 1 September
1999
*39) Change, "Labour rights in China", Hong Kong Christian
Industrial Committee, July 1999
*40) See part on independent monitoring; the FLA
*41) http://www.globalexchange.org/economy/corporations/nike/faq.html
