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Nike Bows to Labor Activists

Posted by Sheila Shayon on July 27, 2010 10:00 AM

In a landmark, unprecedented win, students and human rights activists have forced the hand of retail giant Nike to pay $1.54 million to compensate 1,800 laid off workers in Honduras.

The workers were subcontractors who lost their jobs with the closing of two Nike factories (Hugger and Vision Tex) in 2009. It's a stunning reversal from Nike’s claims a few months ago that it didn't owe the workers a cent.

But the “Just Pay It!” campaign against Nike, led by United Students Against Sweatshops (USAS), was unstoppable.

American college students rallied on more than 40 campuses with two of the dismissed workers, holding massive demonstrations to raise awareness about the workers' plight. When Cornell University and the University of Wisconsin made commitments to end licensing contracts with the largest sportswear company in the world, the victory was achieved.

USAS also used flooded Nike's Twitter and Facebook pages to “publicly shame the company.”

It worked. Nike yesterday agreed to establish a workers' relief fund of $1.5 million to be administered jointly by CGT (Central General de Trabajadores de Honduras, which represents the laid off workers), the Solidarity Center, and the Worker Rights Consortium. It will be supervised by professor Lance Compa of Cornell University.

In addition to the compensation fund, Nike also vowed to "work with its Honduran suppliers to offer vocational training programs and to prioritize hiring of former Hugger and Vision Tex workers as jobs become available over the next two years. Nike will also cover worker’s enrollment in the Honduran Institute of Social Security (IHSS) to obtain health care coverage for a year or until they find new employment, whichever comes first."

"This is a watershed moment for the student anti-sweatshop movement. Our university officials told us contract cuts wouldn't work, but we've proven twice in less than a year that the only way these brands take responsibility is when universities cut their business - money talks," stated Linda Gomaa, USAS International Campaigns Coordinator.

This is the first time a U.S. university has severed a contract with Nike over labor infringements. The USAS has a track record with Nike – forcing them a decade ago to divulge sweatshop locations and allow garment worker unions.

"I am very happy that the workers are finally getting some sort of justice. But this only came from a concerted national effort by a lot of people. We were hitting them where it hurts," commented Alex Bores, president of local chapter Cornell Students Against Sweatshops.

Brands, beware: when college kids become activists and put their heart and voice ahead of their sweatshirts, even the largest global brands have to take notice.

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