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Nike Sweatshops Essay, Research Paper

Nike is the leading shoe and athletic apparel company in the United States and one of the largest in the world. In 1993, Nike?s fiscal revenues were as large as the NBA, NFL, and Major League Baseball?s television deals, ticket sales, and paraphernalia sales combined. In addition to their phenomenal sales, Nike has marketed itself so thoroughly that it has literally become a household name. Over 200 of the 324 NBA players wear Nike shoes, with over 80 of them under contract to do so. 275 professional football players and 290 Major League Baseball players join them. Nike?s fame however, is not limited to professional sports. Over one half of the NCAA championship basketball teams of the past decade have worn Nike shoes and apparel and the company has endorsement agreements with over 200 colleges and universities. The scope of this corporation even extends beyond the United States. Nike recently paid an unfathomable $200 million in an endorsement deal with the Brazilian National Soccer Team (State of California v. NIKE, Inc.; Nike).

This hefty sum of money seems even more outrageous given the conditions of the factories used to produce these high-dollar goods. Nike does much of its shoe production in China where workers cannot be represented by labor unions. In these factories, workers are paid $1.50 at best for a pair of shoes that sells for around $100. In attempts to improve its public image, Nike repeatedly makes claims that its workers are paid double the minimum wage. Ironically, in most cases workers actually make less than the minimum wage. In Vietnamese factories, the minimum wage is $35 per month. Most Nike workers contend to make less, and their pay stubs serve as proof. Some employees actually make as little as 300,000 dong or $25.86 per month. This leaves literally no room for savings and most workers have to seek financial assistance from relatives just to survive (Greenhouse; O?Rourke ).

The same company that paid $200 million for an endorsement can?t pay its workers more than the required $35 a month. Dusty Kidd, Director of Nike Labor Practices offered some insight into Nike?s philosophy. ?I am fully cognizant of the call on the part of some for a ?living wage?. That is generally defined as sufficient income to support the needs of a family of four. We simply cannot ask our contractors to raise wages to that level ? whatever that may be ? while driving us all out of business; and destroying jobs, in the process.? On the contrary, just one month after that statement was issued, Kathryn Reith, Manager of Women?s Sports Issues made a proclamation of her own. ?Nike is fulfilling our responsibility as a global corporate citizen each and every day by guaranteeing a living wage for all workers?and creating opportunity for women?s financial independence.? (State of California v. NIKE, Inc.).

Nike?s female workers have a different view of the situation. The salary they receive cannot even constitute a living wage for a single person, let alone a family of four as Mr. Kidd stated. To eat three meals a day, these women must spend at least $2.10 per day. The average daily wage for these women is $1.60. A salary too small to provide food for them is hardly a living wage. To counter this, Nike CEO Philip Knight wrote a letter to the New York Times dated June 21, 1996 claiming that Nike ?provides free meals, housing, and health care? to its workers. A review of check stubs shows that workers are charged nine cents for their lunch each day, bringing their hourly wage down to 16.8 cents per hour. At the typical 267 hours Vietnamese workers put in each month (107 of those hours being overtime by U.S. standards), they bring home an average of $45. In addition, workers themselves pay for their health care and company-funded housing is a fantasy (State of California v. NIKE, Inc.).

Small salaries such as this fall short of justifying the hours workers are forced to put in. Vietnam?s labor law limits overtime to 200 hours per year on a voluntary basis. Nike workers however are forced to work overtime, often in excess of 500 hours per year. If these workers refuse, they are usually terminated. Unfortunately, long hours aren?t limited to the factories of Vietnam. In China, 11-hour days are standard and workers must work an additional 2.4 hours of overtime each day. This practice violates both Chinese labor laws and Nike?s own Code of Conduct. The workers here are given two to four days off per month, again contrary to the laws and Code of Conduct which both call for at least one day of rest per week (Vietnam Labor Watch; State of California v. NIKE, Inc.).

It would seem that these illegal practices shouldn?t go on undiscovered for long and that the government or Nike would step in. In many cases though, workers are afraid to report such issues out of fear of losing their jobs. In these underdeveloped countries, there are few other opportunities and a reputation as a troublemaker may follow the worker in the future. Furthermore, in many countries, the workers are not allowed to form unions, so there is no one to look out for their interests. In Indonesia where a union does exist, workers don?t have a choice of what union represents them. The trade union, SPSI has never bargained in favor of the workers. In 1999, the Indonesian government gave a three-month extension for a new collective labor agreement on August 30, just one day before the old one would expire. The problem holding up the new agreement was the worker?s request of a ?seniority clause? to their contracts. This clause would give workers a raise of 15 cents per day for each year of service with the company. Had it been granted, this raise would have cost Nike $9000 per day. On the final day of that extension, an agreement was finally signed, but it gave the workers nothing new (Press for Change).

According to Nike?s own Memorandum of

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