Why do Nike supplier factories need to be monitored by independent organizations like the Worker Rights Consortium? Just look at the facts – Nike has a long history of allowing violations in its 680 supplier factories. Nike can not be trusted to monitor conditions in its own factories.
The Early Days: Physical Abuse and Celebrity Tours
Twenty years ago, Nike’s name was synonymous with sweatshop abuses. Reports abounded of Indonesian workers earning 14 cents an hour – less than minimum wage – and Vietnamese workers who were hit with shoe parts, sexually assaulted, and forced to run outside until they collapsed.
The company repeatedly sent high-profile individuals – former U.N. Ambassador Andrew Young, author Jill Ker Conway, Georgetown basketball coach John Tompson – to the sourcing countries to report out on conditions; each time, these delegations came back with rosy reports about clean, well-lit factories free from abuses. Consumers and experts rightfully disbelieved these shallow assessments. By 1998, iconic Nike CEO Phil Knight had acknowledged that, “the Nike product has become synonymous with slave wages, forced overtime, and arbitrary abuse.” By this time, Nike had switched from commissioning sporadic celebrity visits to its factories to creating its own in-house auditing program. While Nike has trumpeted this corporate social responsibility (CSR) operation for the past fifteen years, the Worker Rights Consortium (WRC) and other independent investigators have continued to document violations that have been missed – or left uncorrected – by Nike and its monitors. In 2001, the first investigation of the newly formed WRC was conducted at the Mexmode/Kukdong factory in Mexico. As the New York Times explained, workers “fed up with finding worms in their salad” and with other abuses had protested at Mexmode; when the factory fired the protesting workers, universities successfully pressured Nike to require that the workers be reinstated and their union recognized.
Nike Today: Audits Fail to Prevent Wage Theft, Union-Busting, and Verbal Abuse
Over the past decade, the WRC and other independent investigators have continued to identify serious violations at Nike factories around the world. These violations had persisted despite Nike’s audits, indicating that Nike had either failed to detect the violations or failed to correct them.
In 2011, workers producing Nike shoes told AP reporters that supervisors threw shoes at them, slapped them in the face, kicked them, scratched them, and called them “dogs” and “pigs,” insults that are particularly insulting to Muslim workers. Workers at another Nike shoe factory told the same reporters that they had been forced to stand in the sun for two hours as punishment for not meeting their production quotas.
For years leading up to 2012, massive Nike shoe supplier Nikomas failed to pay nearly 4,500 workers legally required overtime. According to a settlement reached after a year of pressure from independent activist Jim Keady and an Indonesian union, the factory ultimately paid out approximately $1 million in unpaid overtime. However, the settlement only covered two years, while some workers reported that they had been denied overtime pay for up to eighteen years.
Nike suppliers in Indonesia regularly seek government waivers that allow them to pay less than the minimum wage. In 2013, workers reported that one supplier had gone further to cut costs. The factory ordered workers to sign a petition supporting the factory’s application for a minimum wage waiver, and brought military officials to intimidate the workers into signing. According to union officials, the same factory requested that union leaders sign a meeting attendance sheet, and then fraudulently attached the list of signatures to their waiver application, claiming that the union leaders had signed on to support the company’s desire to pay less than the minimum wage.
In 2007, a Nike collegiate supplier illegally fired roughly 55 workers after those workers formed a union. After the National Labor Committee exposed these violations and the WRC documented them, the workers were reinstated. The WRC also found that managers engaged at verbal abuse, calling workers vulgar and derogatory epithets, and even physically abused workers. Workers reported sexual harassment, forced overtime, and unreasonable restrictions on access to bathrooms, and drinking water. In 2009, the WRC reported that two Nike collegiate supplier factories had closed without paying 1,600 workers their legally required severance benefits. These factories had also failed to pay required payments into the national health insurance program. The following year, after significant pressure from students and universities, Nike agreed to provide the US$1.54 million needed to make the workers whole.
In 2010, when workers at Nike supplier Pinehurst, which produces collegiate licensed apparel, formed a union to speak out about problems at the factory, management responded by illegally firing worker activists, attempting to coerce workers to resign from the union, and establishing a company union. As part of this anti-union campaign, the company falsified documents and illegally denied workers access to the factory. Only after the WRC documented these violations did Nike and Pinehurst allow the workers to form their union in accordance with Honduran law.
In late 2002, management at a factory called BJ&B recognized the union that a majority of workers had elected to join, and a few months later signed a collective bargaining agreement — the first in any free trade zone factory in the Dominican Republic to provide for wages above the legal minimum. However, shortly after the historic agreement was signed, the WRC expressed concern about the shift of Nike production away from BJ&B to facilities with inferior labor rights records. In late February of 2007, the factory announced it would be closing and nearly the entire workforce was immediately laid off.
In 2008, Australian journalists found migrant workers at a collegiate Nike supplier living in squalid conditions in company housing. The journalists reported that these workers’ passports were held, so they could not leave at will, and that their wages were garnished to cover migration-related fees. While this sparked Nike to declare migrant worker conditions in Malaysia a priority, Nike supplier worker contacted the WRC in 2013 when she was arrested, given a prison sentence, and denied needed medical care, after her work permit had been revoked – on the sole basis of her having contracted a non-communicable, highly-treatable illness. The doctor hired by the company to perform the test failed to provide the worker with appropriate treatment. Instead, after retesting, her work permit was canceled – a fact that the company did not share with the worker until some weeks after the cancellation. As a result, she was imprisoned until the WRC intervened, pressing Nike to take action.
For years, culminating in 2014, a Nike collegiate supplier in China employing 45,000 workers failed to make adequate legally required contributions to the Chinese social security system. The factory’s underpayments meant that workers would be shortchanged when they retired. This violation of Chinese law went undetected, or at least unremedied, by Nike until 30,000 workers went on strike to protest it, compelling the company to make millions of dollars of back payments.
In 2012, workers at Nike suppliers told journalists that they were forced to work overtime above legal limits and subjected to verbal abuse.
When more than 3,000 workers at a Nike supplier took to the street to protest poverty wages in 2013, they were met with police violence. Then, workers reported, the factory fired some 300 workers for participating in the protest.
As part of a factory restructuring in 2010, a Nike collegiate supplier pressured workers to sign false documents and required workers who objected to their reassignments to sit in a single room for an extended period of time. The factory also restricted workers’ access to bathrooms, scolded workers who sought union the right to have their union representatives represent them in a grievance procedure, and failed to provide soap or toilet paper in factory bathrooms.