UW to end licensing agreement with Nike - WKOW 27: Madison, WI Breaking News, Weather and Sports

UPDATE: UW to end licensing agreement with Nike; Nike responds

MADISON (WKOW) -- No more Nike swoosh on UW apparel.

UW-Madison Chancellor Biddy Martin announced Friday the school would end its apparel licensing agreement with Nike, after Nike failed to develop a solution to the displacement of 1,700 workers with the closing of two factories by Nike sub-contractors in January 2009.

"Nike has not developed, and does not intend to develop , meaningful ways of addressing the plight of displaced workers and their families in Honduras,"   Martin said in a statement.

Workers and their student advocates maintained the factory closings have left the workers without $2.2 million in mandated severance pay.

"How can we, with a clear conscience, do business with companies that can't seem to fix a problem,"  Chancellor special assistant Dawn Crim said.

The Student Labor Action Committee (SLAC) and other students had pressured Martin through rallies, demonstrations and other activism to abrogate the Nike deal. 

In December 2009, UW officials had outlined a four month period to give Nike time to resolve the displaced worker issues.

Crim said Martin spoke directly with Nike representatives but did not see progress to justify  the licensing agreement's continuation.

"She absolutely made the right decision,"  SLAC member Jonah Zinn.

Members of the campus' Labor Licensing Policy Committee were informed of Martin's intention to end the agreement as they met and listened to testimony via telephone from two displaced Honduran workers in Washington, D.C.

"Nike hasn't done anything to help our situation,"   displaced worker Gina Cano said.

"It's just more of failed promises."

"There was no severance, just an offer of equipment from the closed factories,"   displaced worker Lowlee Urquia said.

The workers talked of being "blacklisted" and said the unemployment of many of the displaced workers continued.

UW officials said the agreement will lapse June 30 and producers will be given sixty days to move their inventory of UW apparel with Nike branding.

Calls from WKOW27 News to Nike offices in Beaverton, Oregon and New York have gone unreturned.

The agreement has brought UW $49,000 annually in royalties.   Officials said that amount was small in comparison to the university's royalty amount from Adidas and video game manufacturers.

Crim said Martin has talked with presidents and chancellors at other universities about the workers' issues and Nike's role.

Crim said Martin hopes the relationship between UW and Nike can be restored and the workers helped.

"She's hopeful they will rethink their position and maybe do more as a result of our action."

Click on the link below to read Nike's full statement in response to Friday's decision.


MADISON (WKOW) -- Bowing to pressure from a student group at the UW, Chancellor Biddy Martin Friday released a statement, saying the university is ending its relationship with Nike.

Students demonstrated Thursday, calling for an end to the licensing agreement between UW-Madison and Nike over Nike's alleged failure to make sure workers in Honduras receive more than $2 million in severance and other pay.

Below is the entire news release from the university:


The University of Wisconsin-Madison will end its licensing agreement with Nike as a result of the company's failure to adequately address the problems caused by the closing of two Honduran factories.

Chancellor Biddy Martin, in a statement to the university's Labor Licensing Policy Committee (LLPC) today (Friday, April 9), says, "Nike has not developed, and does not intend to develop, meaningful ways of addressing the plight of displaced workers and their families in Honduras. It has not presented clear long-range plans to prevent or respond to similar problems in the future. For this combination of reasons, we have decided to end our relationship for now."

At issue is the non-payment of severance to workers at two apparel factories, Hugger de Honduras and Vision Tex, both of which were under contract with Nike to produce collegiately licensed apparel.

Since the factories were closed without notice in January 2009, their owners have allegedly failed to pay workers a combined total of more than $2 million in legally mandated severance. While Nike did not own the factories in question, the company is obligated under the university's Code of Conduct for the actions of its subcontractors.

Nike had been granted the right to use university logos on its apparel and products, generating a combined total of $49,000 in royalty income to UW-Madison in 2008-09. As a UW-Madison licensee, Nike was required to adhere to the code of conduct. The code addresses workers' wages, working hours, overtime compensation, child labor, forced labor, health and safety, nondiscrimination, harassment or abuse, women's rights, freedom of association and full public disclosure of factory locations.

"We do not take this action lightly," Martin says. "In general, it is preferable to remain engaged with our licensees, to be part of the conversation and to be involved in working toward solutions in what can be described historically as a troubled industry.

"In this case, however, we have reached an impasse and decided it was best, all things considered, to end this business relationship," she adds. "We remain hopeful that Nike - which has had a positive impact on working conditions in the industry overall over the past several years - will ultimately decide that it is in everyone's best interest to ensure that the workers receive severance or to establish a meaningful alternative plan."

During the past several months, UW-Madison has attempted to resolve the situation.

On Nov. 3, Martin was the first university chancellor to write to the corporation asking for a detailed remediation plan. Since then, UW-Madison asked the Worker Rights Consortium to review the situation, followed-up with multiple official letters and with phone calls, and finally, with a face-to-face meeting with Nike executives.

In December, Martin gave the company a 120-day window to work on effective approaches to the situation. Discussions continued between the university and company during that period, but there has been no progress.

Both the LLPC and a student group, the Student Labor Action Coalition, recommended that UW-Madison sever its ties with Nike. In past instances involving other brands, the university has actively engaged companies in an effort to find solutions that ultimately provide the workers with fair compensation.

However, in other cases - such as those involving Russell Athletic in 2009 and New Era in 2008 - the university has taken similar steps to end license relationships.

"Quite simply, we are a university that wants to do the best for workers making products bearing our name," says Dawn Crim, special assistant to the chancellor for community relations and liaison to the LLPC.

UW-Madison has been a national leader among colleges and universities working to curb sweatshop abuses in licensed-apparel manufacturing. The university has contracts allowing more than 500 companies to make products bearing the university's name or logos. The products are made in approximately 3,300 factories in 47 countries worldwide.

Friday's action does not preclude the university from doing business with Nike in the future if the company demonstrates compliance with the labor code of conduct.


MADISON (WKOW) -- A representative of Chancellor Biddy Martin will address Nike's apparel contract with UW-Madison before a meeting of the school's labor licensing policy committee meeting Friday.

Students demonstrated Thursday and called for an end to the licensing agreement between UW-Madison and Nike over Nike's alleged failure to make sure workers in Honduras receive more than $2 million in severance and other pay.   A Honduran supply factory for Nike abruptly closed over a year ago.

Students maintained more than enough time has transpired to allow Nike to resolve the workers' pay issues.

A UW-Madison spokesperson said the chancellor's special liaison to the committee, Dawn Crim will "update" committee members on discussions between university officials and Nike representatives.

WKOW27 News will staff the meeting and have the latest on the controversy over the apparel and shoe giant's relationship with the university on wkowtv.com and during 27 News at 5, 6 and 6:30 p.m.

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