Monday, November 26, 2012

Adidas' "food stamps" in Indonesia

Companies like adidas with its USA headquarters in Portland have no affection for the workers that make adidas products. In Indonesia,  "[t]he owner of PT Kizone fled Indonesia in Janaury 2011 without paying workers $3.3 million in legally mandated severance. More than 2,800 workers are affected."

From Workers Rights Consortium: "an independent labor rights monitoring organization, conducting investigations of working conditions in factories around the globe." Their "purpose is to combat sweatshops and protect the rights of workers who make apparel and other products."
"The factory produced for Nike, adidas, the Dallas Cowboys, and other brands. Nike has paid the workers $500,000 and persuaded Green Textile, an intermediary that placed brands’ orders at the factory, to pay $1 million. The Dallas Cowboys have paid $55,000. Nearly $1.8 million is still owed to the workers. Adidas has refused to contribute, instead providing a comparatively small amount of shopping vouchers to a local convenience store and sponsoring a job placement program which has only helped a small portion of workers. The workers have repeatedly rejected the food vouchers as an inappropriate means of compensation [Bold emphasis added]." [WRC Factory Investigation].
Three key points with respect to the food vouchers offered by Adidas instead of direct compensation:
"Worker representatives opposed this program as a means of aiding the PT Kizone workers, both because they do not consider it a legitimate substitute for paying workers what they are legally owed and because the food vouchers, as structured by adidas, were of very limited utility . . . ."
"The food vouchers adidas provided were designed in a manner that reflects disregard for the needs of the affected workers. Specifically, the food vouchers were a) valid only at a single chain of markets, Alfamart, which is similar to 7-11 and which workers do not patronize because they consider it to be overpriced, . . . ."
"From a legal and labor rights standpoint, in-kind assistance like food vouchers cannot be substituted for workers’ lawful compensation, except by agreement with workers’ chosen representatives."
The conduct of adidas stands in sharp contrast to Nike and the Dallas Cowboys.  One presumes: all in the name of serving their shareholders.