UW-Madison’s primary licensing committee passed a resolution Friday to define a successful mediation period with adidas as occurring only if the company ensures all workers are paid severance by April 15. This deadline is 60 days after UW-Madison Chancellor David Ward initially announced plans to enter mediation with the company.
The meeting took place amidst controversy over how the chancellor should handle adidas’ refusal to pay nearly 2,700 unemployed workers due severance after a factory contracted by the company shut down in 2011. While the Labor Licensing Policy Committee recommended Ward give adidas a 90-day ultimatum to ensure the workers receive severance, the chancellor decided to enter the 60-day negotiation period with the company.
Although Ward approved of the LLPC’s resolution, he worried a strict April 15 deadline on the mediation process could prevent the university and adidas from coming to an agreement. Noting that adidas has consistently said they would not pay the workers if given 90 day’s notice, he said a flexible deadline would allow the parties to resolve the situation if they are close to an agreement.
“If it takes a little longer, it seems to me that that’s better than abruptly saying ‘sorry adidas, we don’t want to talk to you anymore’ and that’s the end of it,” Ward said. “Then they’re never going to pay any money to the workers.”
Despite adidas’ policy not to pay workers severance, Ward said he thinks an independent mediator agreed upon by both parties could sway the company otherwise if they find the company responsible for ensuring the workers are paid.
Additionally, the chancellor said he wants to know if the mediator would find the university liable if it decides to sever ties with adidas. Ward said this possibility has worried him since adidas threatened to sue the university if put on notice on the grounds that UW-Madison is misinterpreting the code of conduct.
However, LLPC student member Jonah Zinn said not pressuring adidas to pay workers for fear of a lawsuit could be consequential.
“It worries me that if we don’t hold adidas accountable and we allow them to selectively violate our contract that that sets a dangerous precedent for them being able to selectively violate the [code of conduct] in the future,” Zinn said.
But Ward said if the university severs ties with adidas and loses a lawsuit, it would have drastic financial consequences for the university and the code of conduct would have to undergo changes.
Vice Chancellor for Administration Darrell Bazzell also said some of the LLPC’s provisions, including its request to have a member present at mediation, are not up to the university. While he said the university could make such suggestions, the ultimate decision lies with the Wisconsin Department of Justice.
