This article is from the UK Observer Sunday 20th May 2001

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 Nike accused of tolerating sweatshops

New report says workers still on low wages despite pledge, reports Burhan Wazir

 Burhan Wazir
Sunday May 20, 2001
The Observer

 Nike employees continue to face poverty, harassment, dismissal and violent intimidation despite its pledge three years ago to improve conditions for the 500,000-strong global workforce.

A new report, Still Waiting For Nike To Do It, published by the San Francisco-based Global Exchange, says Nike workers still toil for excessive hours in high-pressure work environments while not earning enough to meet the basic needs of their children.

The report's findings will further embarrass a company already discredited by consumer groups for exploitation of labour.

In 1996 Nike was severely embarrassed when a US magazine featured a photograph of a young Pakistani boy sewing together a Nike football. The following year it was revealed that workers in one of its contracted factories in Vietnam were being exposed to toxic fumes at up to 177 times the Vietnamese legal limit.

Still Waiting For Nike To Do It follows up the various promises made three years ago by Phil Knight, the company's chairman, to overhaul appalling conditions faced by the Nike workforce.

Standing before the American National Press Club in Washington DC, Knight told journalists and trade union activists that he personally would ensure an improvement in conditions at Nike factories around the world. He promised six main improvements:

* All Nike shoe factories would meet US air quality standards.

* The minimum age would be raised to 18 for workers in Nike shoe factories and 16 those in for clothing factories.

* Nike would include non-governmental organisations in factory monitoring, and the company would make inspection results public.

* Nike would expand its worker education programme, with free secondary-school equivalent courses.

* A loan programme would be expanded to benefit 4,000 families in Vietnam, Indonesia, Pakistan and Thailand.

* Research on responsible business practices would be funded at four universities.

The Global Exchange report concludes, however, that the projects Knight announced have been of 'little benefit to Nike workers' or 'have helped only a tiny minority, or else have no relevance to Nike factories at all'. And while the report's authors find that 'the education programme has ex-panded, wages paid in Nike factories are so low that the great majority of workers cannot afford to give up overtime income in order to take one of the courses'.

'During the last three years, Nike has continued to treat the sweatshop issue as a public relations inconvenience rather than as a serious human rights matter,' said Leila Salazar, corporate accountability director for Global Exchange.

The study also indicates that in many Nike factories the employees are still being coerced into working up to 70 hours per week and are being humiliated in front of other workers or threatened with dismissal if they refuse to do the extra work.

Knight last week discounted the report and said Nike had done more than any similar company to make sure that its workers were treated fairly.

'I think we've made significant strides, and I'm proud of what the company has done over the last three years,' he said. 'It may take a while longer, but I do think that it will be understood that Nike is a good citizen in all the countries that it operates in.'

Anti-Nike chants and boycotts of stores have become the backbone of the movement against the company, which employs 500,000 people in 55 countries. The negative publicity - at odds with the company's sleek designs and 'Just Do It' slogan - has seen the sales of its trainers plummet.

While its $9 billion turnover in 2000 was an increase of 2.5 per cent on the year before, sales of Nike products fell by nearly 8 per cent in 1999. And as rival shoemaker Reebok has seen its share price rise from $8 to $30 in the past year, Nike's stock has fallen by 15 per cent.

In February, Nike issued a report confessing the company's role in facilitating worker exploitation. It uncovered the exchange of sexual favours for jobs at factories in Indonesia. The company - which sponsors sports celeb rities such as Michael Jordan and Tiger Woods - revealed that 30 per cent of the employees interviewed at Nike franchises in Indonesia had been abused verbally.

Jason Mark, of Global Exchange, said: 'The key to solving many of Nike's problems would be to pay a living wage that allowed workers to save money, raise a family and move up to their society's middle class. Nike says they can't find a formula because it's different for every country. It's an assumption that's convenient for them, because it allows them to pay lower wages.'

burhan.wazir@observer.co.uk
 

Related links:
www.corpwatch.org/issues/sweatshops Corporation Watch campaign site
nikebiz.com Nike's look at the issue