Nike: Just Don't Do It

from Global Exchange, June 1997

Thanks to billions of dollars in advertising, the Nike symbol and Nike products are known throughout the world. Celebrities such as basketball star Michael Jordan, golfer Tiger Woods, and tennis pro Andre Agassi are paid millions every year to lend their names to the promotion of Nike products.

Less well known, however, is the story behind the symbol: how Nike has been a pioneer in exploiting the low wage labor of workers in other countries-so much so that Nike Chief Executive Officer Philip Knight is one of the richest people in the world.

During the 1970s, most Nike shoes were made in South Korea and Taiwan. When workers there gained new freedom to organize and wages began to rise, Nike looked for "greener pastures." It found them in Indonesia and China, where Nike started producing in the 1980s, and most recently in Vietnam.

"Nike has always been on the cutting edge of corporate America," says Kevin Danaher of Global Exchange, editor of Corporations are Gonna Get Your Mama: Globalization and the Downsizing of the American Dream. "When hiring overseas subcontractors became a fashionable cost-saving procedure, Nike was among the trend setting elite, eliminating nearly all of their U.S. work force by 1992 in favor of low-wage Asian producers." Nike's own promotional materials acknowledge that its labor costs for producing a pair of shoes are just $4.90 while the shoes retail for $150.

The majority of Nike shoes are made in Indonesia and China, countries with governments that prohibit independent unions and set the minimum wage at rock bottom. The Indonesian government admits that the minimum wage there does not provide enough to supply the basic needs of one person, let alone a family. In early 1997 the entry-level wage was a miserable $2.46 a day. Labor groups estimate that a livable wage in Indonesia is about $4.00 a day.

In Vietnam the pay is even less- 20 cents an hour, or a mere $ 1.60 a day. But in urban Vietnam, three simple meals cost about $2.10 a day, and then of course there is rent, transportation, clothing, health care, and much more. According to Thuyen Nguyen of Vietnam Labor Watch, a living wage in Vietnam is at least $3 a day.

Nike's Defense

In response to increasing pressure from labor and human rights groups, Nike has mounted a PR counter-offensive. It created a Labor Relations Department, hired the accounting firm Ernst and Young to monitor the factories, contracted former UN Ambassador Andrew Young to review implementation of Nike's Code of Conduct, joined Business for Social Responsibility and participated in the Presidential task force on sweatshops. Yet none of these moves gets at the root of the problem: the fact that Nike is not paying its overseas workers a living wage.

Compare what Nike pays its workers with the pay of Nike's executives and celebrity promoters. CEO Philip Knight is one of the richest people on the planet. To match Mr. Knight's $5.2 billion dollar worth, a young Chinese woman would have to work 9 hours a day, six days a week ... for 100 centuries! Michael Jordan gets $20 million a year to promote Nike sneakers, more than the annual income of 30,000 Asian women who make Nike shoes.

"Nike is such a wealthy company that it can certainly afford to do better," insists Medea Benjamin, who coordinates a Corporate Accountability Campaign for Global Exchange in San Francisco. "In fact, just 2 percent of Nike's $560 million marketing outlays could raise the salary of all 25,000 Vietnamese workers from a meager $1.60 a day to a livable wage of $3 a day."

The campaign against Nike is already having an effect where it counts most: the company's bottom line. A May 4, 1997 article in The Oregonian, Nike's hometown paper, reports: "Retailers say a small but noticeable fraction of customers are avoiding the brand on principle. Alarmed by reports of labor abuses in Third World factories, some shoe consumers say they want nothing to do with the dominant name in the industry."

We must keep up the momentum. We must make Nike take responsibility for how its products are made, and then move on to get other companies to follow suit. Our job now is to create strong coalitions of human rights, labor, religious and consumer groups that will force the shoe and garment industries to behave responsibly.

It's an exciting time to be working to democratize the corporate giants. Never before has there been such public awareness and outrage. Now is the time to turn this outrage into proactive solutions.

What you can do

It is up to the citizens of the country in which Nike is incorporated to bring pressure for fundamental change. Labor, religious, and consumer groups have increased their anti-Nike organizing. We are demanding that Nike agree to independent monitoring of their factories by local human rights groups, that the company settle claims by workers who were unfairly dismissed, that independent organizing be allowed in Nike factories, and that wages and work conditions be improved.

Here's what you can do to help strengthen this movement:

1. Just Don't Buy It: Don't buy Nike products and en courage your friends and relatives to stop buying them until labor conditions improve significantly.

2. Tell Nike what you think: Write a letter to Nike CEO Philip Knight telling him you won't buy their products if Nike doesn't pay their foreign workers a living wage based on an 8-hour day; they should not use child labor; they should guarantee their workers the right to organize free trade unions; and they should allow in dependent monitoring of their contractors by local human rights organizations. A letter is the best because it forces Nike to respond, but if you can't write, try calling. The number is (800) 344-6453, press 3, press 1 and leave your message (you can call any time of day or night).

3. Talk to consumers: Pass out leaflets at your local Niketown store, Foot locker, or any other store that sells Nikes. In San Francisco, we flyer in front of Niketown every Saturday from noon to 2 pm. It's a great way to en gage people in conversation. Also, buy a bunch of Just Don't Do It t-shirts for yourself and friends. They're guaranteed to get people talking about the is sues! (see order form on the next page)

4. Talk to people selling the shoes: Visit local stores that sell sports shoes and talk to the salesperson or manager about your concerns. Ask them where the shoes are made (you can tell by looking in the tongue) and how much the workers are paid. Already, more and more consumers are going into stores and saying they want shoes that aren't Nikes.

5. Educate others: Give talks at your local middle school, high school, college, church, community center, business association or athletic club. We can lend you a copy of a video on Nike's practices in Asia to use in your talk, and an outline of what points to cover. You don't have to be an "expert" to give these talks-only a concerned consumer.

6. Start a petition drive or a sign-on letter: Get your friends, relatives and coworkers to sign on, and then branch out to get local community leaders (politicians, academics, religious leaders, business people, community advocates) to sign on. We can send you a sample letter and petition or you can use the material in this pamphlet.

7. Get your city to pass a No Sweatshop resolution: The city of North Olmsted, Ohio was the first city in the country to pass a resolution against purchasing goods made in sweatshops. Through grassroots pressure, the resolution is now being adopted by other cities around the country. Contact us for a copy of the resolution to take to your mayor or city council. You can also try to get a similar resolution passed at your university.

8. Join Global Exchange: Global Exchange is organizing to reform the behavior of all large corporations, including Nike. We produce educational materials, organize speaking tours to spread an alternative message, support the fair trade movement through our retail stores and our active involvement in the Fair Trade Federation, and participate in coalitions such as the U.S. Network for Global Economic Justice which aim to educate and mobilize the public on global economy issues. Global Exchange members receive our quarterly newsletter and action alerts, get priority on our Reality Tours, and receive a 10 percent discount on our books and other resources. To become a GX member or get more information, please use the coupon on the back page or call us at (800) 497-1994.

Global Exchange; 2017 Mission St.; #303, San Francisco; CA 94110 (415)255-7296

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Here's a sample letter you can get local groups and individuals to endorse and send to Nike. Please send us a copy with names and addresses of signees.

Philip Knight, CEO
Nike Corporation
One Bowerman Drive
Beaverton, OR 97005

Dear Mr. Knight,

We the undersigned, are deeply concerned about ongoing problems in factories in Indonesia and Vietnam that produce Nike shoes. These problems include inadequate pay, forced overtime, and abusive treatment of workers. The massive strikes in April/May 1997 involving 10,000 workers in Indonesia and 1,300 in Vietnam give new urgency to the need to find a solution.

We understand that Nike has taken some actions to address these problems, including creating a Labor Relations Department, hiring the accounting firm Ernst and Young to monitor the factories, hiring former Ambassador Andrew Young to review implementation of Nike's Code of Conduct, joining Business for Social Responsibility and participating in the Presidential task force on sweat shops. However, none of these moves has been adequate to address the root of the problem, which is that Nike is not paying its overseas workers a living wage. The wage in Vietnam is not enough for three decent meals a day, let alone housing, transportation, clothing and health care. In Indonesia, the government itself says that the minimum wage, which is now $2.50 a day in Jakarta, covers only 90 percent of the basic subsistence needs of one person.

Nike, with its tremendous financial resources, should and must do better. We call on Nike to take two steps: 1. Pay workers enough for them to live decent, dignified lives. In Vietnam that means at least $3 a day, and in Indonesia at least $4 a day. 2. Initiate independent monitoring by respected groups that can communicate well with both the company and the workers. For Indonesia, we urge you to hire the Indonesian Sports Shoe Monitoring Network, and for Vietnam, Vietnam Labor Watch.

We urge you to take these actions quickly to avoid further trauma to the workers who make your products and further erosion of Nike's reputation. If you pay your workers a living wage, and use these respected groups as monitors, we are certain that the company and the workers will all benefit, and that consumers will start feeling better again about buying your products.

Sincerely,

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Shoe Brutality in Vietnam

by Bob Herbert, The New York Times

excerpted from The New York Times, March 28, 1997.

On March 8, which happened to be International Women's Day, 56 women employed at a factory making Nike shoes in Dong Nai, Vietnam, were punished because they hadn't worn regulation shoes to work. Factory officials ordered the women outside and made them run around the factory in the hot sun. The women ran and ran and ran. One fainted, and then another. Still they ran. They would be taught a lesson. They had worn the wrong shoes to work. More women fainted. The ordeal didn't end until a dozen workers had collapsed.

Thuyen Nguyen, a Vietnamese-American businessman who has been studying conditions at factories that make Nike shoes in Vietnam, wrote: "Vietnamese all over the country were outraged that on International Women's Day, when most companies in Vietnam give women workers flowers and other gifts, 12 Vietnamese women were so abused they had to spend the day in the emergency room."

Nike set up shop in Vietnam because labor there is even cheaper than in Indonesia. But apparently not cheap enough. Mr. Nguyen found that in some cases Nike contractors in Vietnam didn't even bother to pay the locally established minimum wage. And even when the minimum is paid it is not enough to cover the cost of three meager meals a day.

He found that the treatment of workers by the factory managers in Vietnam (usually Korean or Taiwanese nationals) is a "constant source of humiliation," that verbal abuse and sexual harassment occur frequently, and that "corporal punishment is often used." He found that extreme amounts of forced overtime are imposed on Vietnamese workers. "It is a common occurrence to have several workers faint from exhaustion, heat and poor nutrition during their shifts," Mr. Nguyen said. "We were told that several workers even coughed up blood before fainting."

Rather than crack down on the abusive conditions in the factories, Nike has resorted to an elaborate international public relations campaign to give the appearance that it cares about the workers. But no amount of public relations will change the fact that a full-time worker who makes $1.60 a day is likely to spend a fair amount of time hungry if three very simple meals cost $2.10.

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