The
Global Alliance for Workers and Communities is a controversial
NGO/private sector initiative, involving the International Youth
Foundation and the World Bank, in partnership with Nike and Gap.
The Alliance's stated objectives are to assess workers' aspirations
and developmental needs. While the Global Alliance has repeatedly
claimed that it is not a code monitoring or verification body,
the work of the Alliance has regularly been used by Nike to deflect
criticism for labor rights violations, and, in some instances,
to discredit more critical reports by local labor rights organizations.
On February 22, the Global Alliance released a report on labor
practices in nine Nike supply factories in Indonesia. The study
on which the report is based was carried out by the Centre for
Societal Development Studies of Atma Jaya Catholic University
in Jakarta. The full report, including Nike's remediation plan,
is available in English at: http://www.nikebiz.com/labor.
On the positive side, the report confirms that serious labor
rights abuses, documented earlier by more critical Indonesian
NGOs, are continuing to take place in Indonesian factories producing
for Nike. It also calls into question the effectiveness of Nike's
so-called "independent" code monitoring program, which
to date has been carried out by the commercial auditing firm PricewaterhouseCoopers
(PWC).
On the negative side, the release of the report further confuses
the issue of whether the Global Alliance is acting as a code monitoring
body. It also raises a larger strategic question of how labor
rights advocacy groups should respond to the recent trend for
corporations to pick and choose NGOs to investigate labor practices
and/or monitor code compliance.
While corporations like Nike are selectively releasing reports
from NGO investigations, they continue to determine which issues
will be addressed in those investigations and which reports will
and will not be released to the public. Merely calling for NGO
participation in monitoring and/or verification is no longer a
sufficient answer to the codes monitoring dilemma.
| New reports on Nike
Global Exchange (U.S.) recently released a report that
takes a detailed look at the promises Nike made three
years ago and what the company has actually done (very
little) to fulfil them.
The new report can be found at: www.globalexchange.org/economy/corporations/nike/stillwaiting.html
Note that Nike's response is on their website at http://www.nikebiz.com
A second report was published by the National Labour
Comittee (also in the U.S.) and describes the situation
at suppliers in El Salvador producing for Nike, the Gap,
and Walmart and supplying the National Basketball Association
in the U.S. The full report can be found at the NLC site:
www.nlcnet.org
|
What's in the Report?
Based on interviews with more than 4,000 Indonesian Nike workers,
the Global Alliance report documents the following serious instances
of verbal, physical, and sexual abuse by management personnel:
· 56.8% observed verbal abuse of co-workers;
· 13.7 % observed physical abuse;
· 25.7% observed unwanted sexual comments; and
· 15.8% observed unwanted sexual touching.
According to the report, "verbal punishment is often the
result of not reaching targeted outputs, sewing machines breaking
down, products that are rejected, workers who can't keep up with
the line, or workers requesting annual leave." In other words,
abusive treatment by management personnel is linked to the pace
of work, which is largely determined by production demands and
order deadlines imposed by Nike.
The report also indicates that overtime during peak seasons is
extremely high, that 39% of the workers interviewed were dissatisfied
with overtime, and that workers were pressured to sign statements
agreeing to "voluntarily" work overtime. Workers also
reported that "their base wage is quite low and does not
adequately meet the increased cost of living and other needs."
Significantly, these finding are virtually identical to those
in a 1999 study by an Indonesian NGO, the Urban Community Mission.
Of the 3,500 Indonesian Nike production workers interviewed in
that study, 57% reported seeing fellow workers mistreated or yelled
at. 44% complained of forced overtime. The Urban Community Mission
report also revealed that the vast majority of workers were receiving
much lower pay than Nike claimed they were receiving.
When the Urban Community Mission released its study in 1999,
Nike responded by trying to discredit the report, calling it unprofessional.
They contrasted the Urban Community Mission's study with the so-called
"professional" and "independent" monitoring
carried out by the commercial auditing firm PricewaterhouseCoopers
(PWC), claiming that PWC's audits proved that the allegations
of abuse in the Urban Community Mission's report were unfounded.
Two years later, Nike's decision to release the Global Alliance
report represents an admission that a local Indonesian NGO had
more accurate information on labour practices in its supply factories
than did its "professional" social auditor. Apparently,
this decision was made after extensive internal debate within
the company about the seriousness of the code violations documented
in the report and the questions it would raise about the effectiveness
and credibility of Nike's code monitoring program.
What's Missing in this Picture?
While Nike has decided to address the hot-button issues of verbal,
physical, and sexual abuse exposed in the Global Alliance report,
its response to workers' complaints of inadequate wages and excessive
and forced overtime is far less encouraging. On wages, Nike promises
to "ensure the factories have a clear communication process
in place to educate workers on their compensation structure and
calculations," but continues to insist that "the adequacy
of wages is a contentious issue in Indonesia." On hours of
work, Nike admits that excessive overtime is "both a Nike
compliance problem as well as a structural problem within the
apparel industry worldwide," but then states that a maximum
of 72 hours a week is acceptable for factories that receive a
government exemption from the legal limit of 54 hours. It then
points approvingly to its current policy of requiring factories
to notify workers in advance when overtime is required and to
have workers sign agreements to "voluntarily" work overtime,
ignoring the report's finding that workers feel pressured to sign
these "voluntary" agreements.
Totally missing from the study is the crucial question of freedom
of association. Despite the fact that the right to join and form
independent unions is a major issue in Indonesia, an issue for
which Nike has repeatedly come under fire, the Global Alliance
study failed to even mention the issue.
What Will Come Out of the Study?
Surprisingly, Nike has not suffered very much negative publicity
as a result of the publication of the Global Alliance report.
In fact, Nike has even received some - limited - positive publicity
for its decision to make public these very disturbing findings.
Of course, Nike will face renewed criticism if the same or similar
labor rights abuses are reported in yet another study two years
in the future.
If Nike takes the Global Alliance report seriously, it will be
compelled to reexamine its current code monitoring and verification
program, including the apparent inability of its commercial auditors
to gain sufficient trust of workers to determine whether violations
are occurring. It will also have to face the underlying problem
that its pricing policies and production demands are at least
partially responsible for continuing abuses.
In the "Nike Remediation Plan" attached to the report,
Nike acknowledges there are "problems behind the problems"
in its code compliance system and in the "fundamental business
dynamics that lead to non-compliance." It also pledges to
take "a fresh look at the worker-management relationship
and how communication, collaboration and improvements can be fostered
more effectively through various means, including trade unions."
For Nike to win credibility among labor rights organizations and
with the workers who make its products, it will have to put these
nice words into practice.
In the wake of its Indonesia report, the Global Alliance must
also deal with its credibility problem. If studies by the Global
Alliance continue to be used by Nike, or any other corporate members,
as part of its code compliance program, or the assessment of that
program, the Global Alliance has a responsibility to publicly
define its role in that program. At the very least, the Alliance
must ensure that all future studies address all issues relevant
to corporate codes, international standards, and local law, including
freedom of association.
(Source: MSN Codes Memo: Number 6, April 2001)
For a critique of the Global Alliance needs assessment
done in Thailand,
see "Lian
Thai Industrial and the Global Alliance for Workers and
Communities," on the CCC website
To read the various Global Alliance reports, visit their
website at: http://www.theglobalalliance.com/ |
