UW-Madison addresses Nike-Honduras issues

Dec. 4, 2009

by John Lucas

Chancellor Biddy Martin is asking Nike to act during the next four months to remedy troubling reports of workers' rights abuses at the factories of two of the company’s subcontractors in Honduras.

At issue is the treatment of workers at two apparel factories, Hugger de Honduras and Vision Tex. Both factories, at which it is believed that collegiately licensed apparel was produced, were shut down without notice in January.

Since then, their owners have allegedly failed to pay workers a combined total of more than $2 million in legally mandated severance and back wages. Nike is a UW-Madison licensee.

Employees are reportedly owed an average of $1,000 per person, a significant sum in the country, according to the Workers Rights Consortium, the university’s independent labor monitoring organization.

To begin to address the issue, on Nov. 3, Martin was the first college president to write to the corporation asking for a detailed remediation plan.

At its November meeting, the university’s Labor Licensing Policy Committee (LLPC) recommended that UW-Madison initiate termination of licensing agreements with Nike in response to perceived material breaches of the code of conduct. The group acts as an advisory body to Martin.

In response, Martin wrote the committee on Dec. 4 notifying the group that she believes the company is working in good faith toward a resolution and plans to give the company four months to solve the issue or make “satisfactory, demonstrable progress” or allow the company’s relationship with the university to lapse.

“Nike agrees that the situation constitutes a problem that they have a responsibility to address,” Martin wrote. “They have been open about the range of complexities involved, but have not argued that the complexities absolve them of responsibility to make concerted efforts. I am heartened by that position.”

Martin is also seeking to build a coalition of interested schools from the Big Ten and other peer institutions, as well as the Workers Rights Consortium and the Collegiate Licensing Company.

“Time and time again, UW-Madison has demonstrated national leadership in the areas of workers’ rights and licensing issues,” says Dawn Crim, special assistant to Martin for community relations. “We intend to do everything possible to continue to encourage Nike to take more corporate responsibility for the Honduras situation."

Nike is a university licensee, generating a combined total of $49,000 in royalty income to UW-Madison in 2008-09. In signing its licensing agreement, Nike agreed to a code of conduct that stipulated its responsibilities in dealing with workers, factories, subcontractors and suppliers.

In past instances involving other brands, the university has actively engaged companies in an effort to find solutions that ultimately see workers fairly compensated.