NIKE'S 70 MILLION PAIRS OF SNEAKERS
(Tapol Bulletin, n. 136 - August 1996)
The choice of Nike was logical; the sneaker giant is riding on the crest of the international sports boom and has become a multinational giant with a revenue of US$6.5 billion. In the year ending 31 May, Nike's earnings rose 38 percent to a whopping US$553.2 million. A pair of Pegasus runner shoes retails for US$75 while production costs plus shipping amounts to $18.25.
The Nike symbol has become a global trademark; everywhere, young people wear Nike sneakers, T-shirts or shell suits. It was targeted because it is the biggest the most visible and by far the most hypocritical of all the companies producing sportswear. Nike invests huge sums of money to improve its image, contributing money to charities and public schools.
Like other global brands, Nike nowadays manufactures its goods in many parts of the world, preferable in those places where labour is cheap. Instead of setting up Nike companies in these countries, it is more convenient to use sub-contractors. Criticism of labour conditions can be d flected by blaming the sub-contractor. Philip Knight, Nike's top executive, argue that the minimum-wage workers are paid enough to live reasonable comfortable lives.
Indonesia, the shoe fits
Indonesia has become the major producer of Nike goods. A phenomenal 70 million pairs of sneakers are glued, stitched, pressed and boxed annually by a mostly female workforce. The twelve sub-contracting companies are: PT Star Win, PT Nasa, PT Doson Indonesia, PT Pratama Abadi Industry, PT Garuda Indawa and PT Hasi in the Tangerang industrial area; PT Sung Hwa, PT Tae Hwa, PT Eltri Indo Footwear and PT Nikomas Gemilang in Serang, West Java; Mitracorp Footwear International in Jakarta and PT Feng Tay in Bandung. At least half are Korean or Taiwanese, the countries where Nike used to produce their goods. When labour there became too expensive, the companies moved to Indonesia and more recently to China. The two countries have notorious records of government intervention in labour matters and no freedom of association for workers.
PT Nikomas Gemilang, the company based in Serang, 75 kms west of Jakarta, produces 1.2 million pairs a month, Sumantri, a 25-year old labour activist, said of the factory: '"From the outsicle, it looks like heaven, but for workers on the inside, it's hell" (Business Week, 29 July). The same report continues: "Overtime is mandatory. Workers say exhausted colleagues regularly faint from overwork. Punishment for misdeeds consists of petty humiliation. A supervisor who skipped work one Sunday to care for his sick wife and child was forced to clean toilets and then was demoted. Another worker had to run laps around the factory because shoes she assembled had defects."
Reporter Mark L. Clifford of Business Week who went to the site was detained and interrogated for four hours by 18 plainsclothes police demanding to know what he was doing. In particular they were inquiring about information the workers had given him about the conditions and whether the minimum wage was regarded as sufficient.
Some Nike sub-contractors are situated in brand new, glossy buildings. PT Feng Tay Indonesia, a Taiwanese owned company, is described as a quiet, well-ventilated US$45 million factory. Another, PT Nasa is, according to union leader, Mochtar Pakpahan, "the best factory I've ever visited". After Pakpahan's visit, the authorities forced the management to sack three of his union's members and banned further contact with the free trade union, SBSI.
Cicih Sukaesih
Labour and human rights campaigners in the US invited a former Nike worker to tour the US. Cicih Sukaesih who is 32 years old and unmarried, used to work at PT Sung Hwa in Serang and led several actions against the company. In 1991, after the minimum wage had been raised to US$1.25 a day, the company refused to pay up, so the 600 workers including Cicih Sukaesih staged a walk-out. Labour conditions then were much worse than nowadays. The police and military quickly suppressed the action. In January 1992 she and 23 others, regarded as the ring-leaders, were sacked. The Korean foremen were particularly rude. Cicih says: "They yelled at us. There were some who liked to hit people, slap people. There were some who would kick the Muslim workers when they were praying during their lunch break" (International Herald Tribune, 13/14 July).
Cicih Sukaesih and her fellow workers have taken their case to court but it still hasn't reached the Supreme Court and a decision is unlikely in the foreseeable future. Her prospects are grim; at 32, she is already considered to be 'too old'. During her visit to the US, she also tried to settle a claim against Nike for her and her co-workers' dismissal and force the Oregon-based company to agree to independent monitoring of sub-contracting companies as a safe guard against abuses on the shopfloor.
Consumer pressure
Present day lobbying and pressure on companies requires much more than strikes. In many countries in the North, campaigning against sweatshops has become very effective. In the face of bad publicity and consumer boycotts, companies have been forced to reform semi-slavery conditions.
It forced the trendy US clothing chain, GAP, to adopt a code of vendor conduct, including standards relating to child labour, forced labour and working conditions. Kathie Lee Gifford, the popular TV talkshow host in the US, moved the hearts of many millions in June when she broke down during a live broadcast. She told viewers she had no idea that clothing endorsed by her and sold in the Wal-Mart department store chain was manufactured in sweatshop conditions in Honduras and New York by girls earning 31 dollar cents an hour. Other manufacturing giants like The Disney Corporation, J.C. Penney and Talbots have now promised to monitor their subcontractors more closely and have threatened to terminate contracts if violations persist.
In July Robert Reich, the US labour secretary joined the campaign "to eradicate sweatshops from the American garment industry and erase the word entirely from the American lexicon". (Financial Times, 15 July 1996). The same week, labour activists stepped up their campaign against Nike by demonstrating on 16 July in front of a Nike shop in downtown Washington. Spokesperson for Global Exchange, Medea Benyamin, said: "We are using this opportunity to launch a national campaign in order for Nike to accept the results of an independent inquiry on all the Nike companies in Indonesia, to resolve the matter of workers who have been dismissed, to raise their wages and improve their working conditions" (Media Indonesia, 17 July 1996).
Jeff Ballinger from Press for Change stressed that Nike sub-contractors in Indonesia pay wages not adequate for a reasonable standard of living and are forcing workers to do overtime. In several cases, workers have been paid the rates payable to a trainee.
Both organisations argue that Nike control of sub-contracting companies in Indonesia is bad and have called for an inspection team to be send to Indonesia.
Just (don't) do it
Nike is clearly embarrassed by the campaign. Intensitied pressure by US NGOs as well as labour conflicts in the Nike companies have led to improvements over the years.
But Nike still has a long way to go before it can live up to its staled goal of providing a fair environment for all. Some of the twelve companies working for Nike have not even attained Indonesia's very low labour standards.
Improvements are essential regarding compulsory overtime, erratic overtime pay, failure to register workers on the social pensions scheme and insufficient medical care. Women workers are not allowed menstruation leave, provided for under Indonesian law, nor is there adequate provision of food fo workers doing overtime.
Nike executives in Indonesia have been instructed nol to respond to the campaign and company offices Hongkong and Oregon have launched a counter-offensive. Philip Knight, Nike founder and, chief executive, argues that Indonesians are queuing up for jobs in Nike factories. He dismisses talk of low wages and warns that if wages were allowed to go up too much, it would wreck the country's economy. While still an under-graduate at Yale in the early 1960s, Knight wrote a paper on the profit potential of manufacturing athletes' shoes in Asia. His dream may have come true but he's delivered nightmare jobs for Nike work.
Jesse Jackson refused to visit factories
At the start of the Atlanta Olympics, the well-known civil rights campaigner Reverend Jesse Jackson went to Jakarta, hoping to visit some Nike companies but was told to keep out. Dusty Kidd, Nike representative for the Asia Pacific, said the companies were open to 'neutral' people who were not prepared to use visits to 'spread all this kind of rubbish'.
(Suara Pembaruan, 20 July)
STRIKE AT REEBOK AND ADIDAS
Other shoe giants, notably Adidas and Reebok couldn't brag about their working conditions. A strike at PT In doshoes, one of the biggest shoe factories in Tangerang, West Java created quite a stir in the capital. The 1500 workers staged a two-day strike on 18 and 19 June and staged an all-night sit-in at the Parliament building. They demanded better pay, lower prices and a new president for the country. The next morning the workers were forced out by anti-riot police who used sticks and shields. The strike action wassupported by activists from the opposition party PRD. The protestors then marched to the Ministry of Manpower, some 5 kms along the same main street.
PT Indoshoes is owned by the Salim family, Indonesia's most powerful business conglomerate. The company produces 2.7 million pairs of shoes annually.
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