In a decision that is frustrating members of one UW-Madison student group, UW Chancellor David Ward announced Tuesday the university will enter a period of mediation with adidas in an attempt to resolve the dispute over whether or not the company owes 2,800 unemployed workers severance pay.
The company, currently the university's main licensing partner, sparked anger when one of its factories abruptly closed in January and the workers were not paid due severance. Adidas says it is not responsible for paying workers severance fees, because the factory was independently owned and it should not be held accountable for the factory owner's behavior.
Ward's decision comes nearly two weeks after the Labor Licensing Policy Committee recommended, in agreement with the chancellor's initial recommendation, that adidas be given 90 days to remedy the situation or have its contract terminated.
But in a recent email on behalf of the chancellor, UW's Senior Legal Counsel Brian Vaughan told LLPC Chair Lydia Zepeda that Ward has decided to take a different course of action rather than giving notice. In the coming days, the parties will agree on a designated mediator and a date for the mediation, which could last up to 60 days.
"[Ward] wishes to reiterate that the university's goal in this issue is to see redress for the impacted workers, while simultaneously maintaining our productive relationship with adidas and mitigating financial harm to the institution," Vaughan said. "Mediation is a practical mechanism to work toward achieving these goals."
Despite Ward's efforts to resolve the situation, UW Junior and Student Labor Action Coalition member John Perkins said the chancellor's decision lacks the sense of urgency SLAC members feel the situation deserves.
"We are disappointed, so we will escalate our campaign and continue to apply pressure to the chancellor," Perkins said. "We have to take violations of our labor code of conduct seriously and we can't just dilly-dally."
Perkins added that UW-Madison has traditionally been a leader when confronted with labor violations, noting the university's dismissal of Nike and Russell Athletics when faced with similar circumstances in 2009. He said SLAC would like to see adidas held to the same standard as Nike.
Yet in his email to Zepeda, Vaughan explained why the current situation is "unique."
He said unlike previous alleged labor violations, adidas has chosen to contest the applicability of the university's code of conduct-which outlines a company's responsibilities in dealing with workers, factories and suppliers-to severance pay.
Vaughan said under such conditions, which include disputes over the applicability or interpretation of the code, the university is "contractually obligated" to pursue mediation.
Additionally, Vice Chancellor for Administration Darrell Bazzell told The Daily Cardinal adidas' deal with the university is a licensing agreement and sponsorship contract, which means the company provides badger athletics with equipment in addition to selling badger-logo apparel. Nike and Russell Athletics' contracts only involved the latter. This also means adidas' contract is worth 50 times more than Nike or Russell's were.
