FREE ESSAY ON NIKE

NIKE

The athletic apparel industry in which Nike is involved is a major money maker in the
United States, but the fact that none of the factories are located in North America has
brought some heat to the company. Nike controls more than 40 percent of the U.S. Market
for sports related goods, but doesn't have a single sneaker factory in this country
(Miller 1). Nike continues to make millions of dollars yet exploits workers overseas by
paying them very little, while requiring long hours without overtime pay in factories
that are not up to "American" standard. Nike subcontractors employ nearly 500,000 workers
in plants in Indonesia, China and Vietnam (Saporito 1). The exploitation of workers in
Third World counties, where the majority of Nike's labor is done sparks a controversial
issue. People question why is it that Nike continues these practices. 
According to "Just do it, Nike," Nike seems especially fond of doing business in
undemocratic countries like China and Indonesia, where the military can be relied upon to
"crack heads" if workers get out of line (Miller 2). The military monitoring has been a
large controversy due to the fact that these are often Chinese working against other
Chinese workers, or Vietnamese against their own people also. For Nike there are two
benefits: it it's a cheap way to monitor in an overseas factory and it creates a sheaper
labor workforce. In turn making the labor cheaper for Nike. This makes it possible for
Nike workers from the states to work on other things and only tour the factories when
nessecary. While still assuming a stable workforce without good pay. The critics of Nikes
labor practices have taken tours and witnessed the mistreatment firsthand. Time magazine
reported saying," The plants were found to be modern and clean, well lighted and
ventilated and paying a decent wage by local standards-although by no means are they
trouble free. Make no mistake: these are factories not amusement parks, and even in
developing Asia, where jobs are scarce and getting scarcer, this is not the job of
choice." (Saporito 1)
The wages that the workers overseas are paid is nothing when compared to how much we pay
for a pair of shoes or the profit that CEO Phil Knight is making off his sportswear giant
he once operated out of the back of his car as a college student. 
"A big issue that surrounds sweatshops is wage. The minimum wage often does not reflect
the cost of living." (Hepner Online)
Is the wage fair? There are many people who feel the wage is fair and the cost of living
is taken into account when the wage is looked at, but studies show otherwise in many
factories. Just recently, CNN reported a raise to entry level workers in Indonesia, Nike
officials said "the increase will raise the minimum monthly compensation package-which
includes bonuses, housing, healthcare, transportation and meal allowances to
approximately 
$37.14 a month."(Nike Establishes Labor" Online) To many people living in the U.S., that
package may sound good however the compensation package doesn't do away with the long
hours, the poor conditions or the low rate of pay. Many of these workers are young
children working to help support their families. The benefits do not make up for the low
pay rates that keep them in the work force. The pay is only enough to get by where these
children want to be saving in order to leave the factories and return home.
In "Taking a Look inside Nike's Factories", part of Bill Saporito's, "Can Nike Get
Unstuck?" this is what was found. "Americans pay $100 for a pair of shoes that a worker
gets less than $3 a day to make. They pay Michael Jordan $40 million to endorse them.
Can't they find more money to pay the workers? The short answer is no, because
corporations pay the going rate for labor whereever they are." (Saporito 1) If this
statement is true Nike pays the wage for the country the factory is in, then what is the
controversy about? 
Much of it stems from the overtime that these workers are forced to work without over
time compensation. Here in the United States there are regulations placed on businesses
that require then to compensate their workers with a higher wage for over time hours. So
since Nike is an U.S. based company should Nike have to pay overtime? The answer is no.
Nike doesn't have to pay overtime like here in the U.S. so they don't. 
In Vietnam "Workers so want a reduction in overtime, the length of annual leave for the
Indonesian workers making Nike shoes is more than 30 days though dozens of workers
interviewed in November, said the actual amount is 10 days." (Ballinger 2)
There has been evidence of Nike breaking at least nine labor laws in China according to
AMRC; a Hong Kong based human rights group that has been monitoring the abuse of human
rights in China for the last 20 years. "Children as young as 13, were found employed in
Nike factories, working from 144-192 overtime hours per month to make ends meet."
(Designer 1) Ernest and Young, an accounting firm, hired by Nike, to do research and the
issue reported conditions in Vietnam "where young women toil sixty-five hour weeks for
$10, in air so bad that 78 percent of the employees have respiratory problems."
(Miller1)
Factory workers endure abuse on the job lacking a voice or ablility to do anything about
it. Since Nike contracts out for their factory managers, it has been hard for Nike to
regulate what goes on when they are not on their tour or walk through. "A Korean
supervisor in a Vietnam factory was found guilty of beating 15 Vietnamese about the head
with a shoe "upper", and another Korean supervisor was charged with sexual molestation."
(Saporito 3) In this instance it was not an U.S. supervisor, nor was it a military
officer but someone of a different nationality. The hard part is that there are no
independent unions and meaningful corporate codes of conduct to discipline management. So
workers must turn to the courts for help which is a long fought battle that no one wants
to attempt. In one case that made it to, a Vietnamese court recently found a Korean
supervisor guilty of beating workers and extradition may be sought for the accused sexual
molester who fled. In Indonesia 24 discharged Nike workers are challenging the legality
of their dismissal before the country's Supreme Court (Saporito 3). These are major
breakthroughs in the court systems to have someone tried and convicted in these distant
countries whose courts are often corrupted.
Factory conditions are consistently getting press here in the U.S., as many are angry
with Nike for not providing for their overseas employees. The following account is of the
conditions in a Chiniese factory:
Twelve hour shifts several days a week; wages as low as 16 cents and hour; 16 workers to
a dorm room; pregnant women fired. Workers are not allowed to talk. There is constant
pressure to produce-workers are yelled at. If you don't meet your high production quota
you must stay until you do-without pay. The factory is noisy, filled with dust and fumes.
Workers have fainted, overcome by the long hours and the glue fumes. One worker died;
another lost an arm; other has had their fingers broken by the equipment. Most workers
have never heard of the Nike code of conduct. There is no union and workers are afraid
that if they complain, they will be fired. When a group of workers stopped working in
March to protest had not been paid, they were fired. The supervisor warns workers in
advance of any inspection, the factory is cleaned and if workers are interviewed it is in
the presence of factory management. ("The Neediest and the Greediest" 4)
This is only one description of the factory conditions and the requirements that are put
on the workers of these factories, on contract with Nike. 
In order to deal with the criticism Nike gets about working conditions and pay, "Nike Inc
recently established a new department with a mandate to continue to evolve it's
monitoring of subcontracted manufacturing facilities and to continue to upgrade
conditions for workers in subcontracted facilities around the world." ("Nike establishes"
1) This department will monitor, compensation issues, benefits, the work environments,
recruiting and hiring policies, overtime policies, worker management, environmental
issues and supervision of independent monitoring systems. All these are large steps by
Nike to improve it's factories and to repair the relations with people here in the U.S.
who are appalled by the reports of poor work environment workers are forced to endure.
"The company has been tarred by an image as a sweatshop operator that exploits Asian
workers who make shoes and apparel for Nike subcontractors. Nike's efforts to be a good
corporate citizen, and they have been considerable, have yet to sway the public forum.
Basically, our culture, and our style, is to be a rebel, and we sort of enjoy doing
that," says Knight, who created a jock empire based on hero worship backed up with good
product and great advertising. "Now that we reached a certain size there's a fine line
between being rebel and being a bully, and yeah, we have to walk that line."" (Saporito
6) According to Knight he will continue to make the sport-wear giant successful any way
he can. "The estimated net worth of co founder and current CEO Phil Knight is $5.4
billion, one of the wealthiest people in America." (Miller 1)
The issue remains whether the sports wear giant, Nike, will continue to do work in other
countries, where labor is cheap and regulations are few, and not monitored on a normal
basis. Nike will continue to exploit workers in these countries as long as America
continues to buy the products. Nike, who recently spent $978 million in one year on
advertising worldwide, depends upon Americans and their children to purchase its
sneakers. Yet it locates 150 factories and some 350,000 jobs in Asia. Knight recently
made the absurd and arrogant statement that, "Americans don't want to make shoes.""
(Sanders 2)
Is CEO Phil Knight right? Are American workers not willing to make the shoes that are so
popular in stores and classrooms across the nation. If so, the exploitation will continue
and Nike workers will remain underpaid and over worked in poor working conditions.
Bibliography
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Issue 3 p 21. EbscoHost. Nov. 1999
Baum,Bob. "Study says Nike workers make ends meet plus some." Online. Internet.18
Nov.1999.
Available FTP:Http://www.jrnl.com
Cobb, Chris. "Courting Controversy". Public Relations Tactics. Jun. 1998.Vol.5 Issue 6 p
13 
Ebsco Host. Nov. 1999
Hepner,Mischa. "UC's Take Advantage of Cheap Labor." Online. Internet. 20 Nov. 1999
Available FTP:Http://www.Labor.com
Miller, Anne and Mark Star. "Just do it, Nike." Newsweek. 2 Oct.1995.Vol.126.Issue 14. 
pg 64 Ebsco Host. Nov. 1999
"Nike Establishes Labor Practices Department." Online. Internet. 18 Nov.1999.
Available FTP:Http://www.siagon.com/nike/nike-labor.htm
"Nike Needs to End Exploitation." Online. Internet. 18 Nov. 1999
Available FTP:Http://www.illinimedia.com/di/archives/1997/February/27/
p10-edit1.txt.html
Press, Eyal. "A Nike Sneak." Nation. 5 April 99.Vol. 268 Issue 13 p. 6 Ebsco Host. 
Nov. 1999
Saporito,Bill. "Can Nike Get Unstuck?." Time 30 Mar. 1998, Ebsco Online. 18 Nov. 1999
"The Neediest and the Greediest." Online. Internet. 18 Nov. 1999
Available FTP:Http://www.laborworkers.com