University of Wisconsin-Madiosn’s Labor Licensing Policy Committee expressed concern Wednesday after adidas announced its plan to host a summit abroad to address the issue of companies’ failure to pay severance in the global garment industry.
Over the past year, LLPC has urged Chancellor Ward to cut licensing and sponsorship ties with adidas, the university’s primary licensing partner, after the company failed to pay more than 2,700 Indonesian workers due severance pay after a PT Kizone factory contracted by adidas abruptly shut down in January 2011.
The university is currently in a lawsuit to determine if adidas is obligated to pay the workers.
According to Lingran Kong, a Student Labor Action Committee representative on the LLPC, adidas is flying various university administrators to Switzerland from across the U.S. who expressed concern over business relations with the company to discuss how to handle severance issues in the future as well as possibly setting up an insurance fund.
But Kong said she feels adidas is holding the meeting to reassure concerned administrators they are a socially responsible company, and said the company is “all talk and no action.”
“This is more of a PR spin to portray themselves as responsible,” Kong said. “But it’s very contradictory that they say they are doing this and at the same time denying PT Kizone workers their $1.8 million.”
According to LLPC Chair Lydia Zepeda, it seems as though adidas is “simply trying to create a distraction.”
However, Zepeda also said although the convention does not address the current situation, it could be useful for the future, because severance is one of the “biggest problems around the world.”
“In most countries, the law requires severance because there is no unemployment [check],” Zepeda said. “It’s the only way that when people lose their jobs they can get some compensation.”
According to Zepeda, cutting ties with adidas is a successful strategy to force the company to comply with a contract it signed with the university, noting how Russell and Nike “took care of the problem” when UW-Madison terminated contracts with the athletic companies for also violating workers’ rights in 2009 and 2010.
SLAC will be participating in a national week of action against adidas along with United Students Against Sweat Shops the week of Oct. 15.
