FRIDAY FILE: The sudden closure of two of Nike’s subcontracted factories in Honduras left many people out of work. Negotiations between the CGT* and the sportswear manufacturer led to an agreement that sets a precedent for the recognition of workers’ rights.
By Gabriela De Cicco
Translation by Karen Murray
The municipality of Choloma in north western Honduras has a population of 152,172inhabitants according to the latest national census carried out in 2001. In January of 2009, approximately 1,600 people who live in that region found themselves out of work when Vision Tex and Hugger, two of Nike’s subcontractors, closed down their factories without prior warning. They also failed to pay USD 2 million in wages and severance pay to their workers.
For a full year, Nike denied that they owed any money to their former workers and ignored demands for compensation. Instead, the company announced plans to provide training for its unemployed former staff.
In a letter dated February 1st, 2010, the workers responded that although they had “empty stomachs and huge debts” they did not need capacity building as they were workers with many years of experience manufacturing products of high quality. They emphasised that what they needed was to be paid for the work that they had done, an obligation that Nike’s own code of conduct affirmed. They also made it clear that they needed jobs.
When the organisation United Students Against Sweatshops began to demand that Nike observe its code of conduct and pay the workers what they were owed, the company denied that its subcontractors manufactured branded apparel for North American universities.
This is when the Worker Rights Consortium (WRC) got involved. In conjunction with 150 university affiliates, the WRC monitors factories that make apparel and other goods that bear university logos. Although it does not represent workers, it makes important interventions in labour negotiations and mediations.
The WRC carried out an exhaustive investigation documenting violations of the workers’ rights and also proving that VisionTex and Hugger made products for some North American universities.
The University of Wisconsin in Madison was one of the universities that demonstrated a deep concern about the matter, and this past April it terminated its contract with Nike.
The school Chancellor, Biddy Martin, explained that they did it because the company “had violated its own code of conduct which requires companies who manufacture products for universities to be responsible for their subcontractors.”
According to Gina Cano[i],an employee of Hugger, the investigation carried out by the WRC, the support received from the United Students Against Sweatshops, as well as the action of the universities laid the groundwork for Nike to finally agree to negotiate with the CGT.
Gina notes: “The strength of the workers’ union and the experience of one of its coordinators Evangelina Argueta helped the workers of Hugger and Visión Tex stand firm in their position. Evangelina is well acquainted with the subject matter of the campaign.”
Filled with hope, but also with the fear of returning empty-handed, Gina and Evangelina travelled to Los Angeles in June and sat at the negotiation table.
Gina recalls that for the first 45 minutes of the meeting, the company appeared to adopt an intransigent position, but finally both sides reached an agreement: Nike would pay USD 1.5million, and for one year would cover the Honduran social security registration costs for the workers and their families. The company also committed to obtaining work for the employees in other factories.
“We are now in the most difficult stage of the process:” says Gina. “Waiting for the agreement to be fulfilled.” She adds that although the workers will benefit financially from the agreement, “We consider the most important gain to be the guarantee that they will also regain employment and health coverage, which in our country is very expensive.”
The agreement signed between Nike and the CGT of Honduras is of extreme importance as it sets a significant precedent: For the first time a global clothing brand has assumed responsibility for the wrongful actions of their suppliers in closing down factories without giving their workers prior warning or compensation.
Gina confirms that there is already evidence that awareness is spreading to other parts of the country.In an article published by the newspaper “El Heraldo” on August 17, 2010, a representative of the Honduran Association of Maquiladores highlighted the obligations that subcontractors of brand-name companies have towards their staff.
When asked about work conditions in the maquilas in Honduras, Evangelina explains that since the country has high levels of unemployment,many workers endure abuses and rights violations in the maquilas for fear of losing their jobs. “For the CGT this is unacceptable,” she says. “Workers are entitled to decent work conditions and just wages.”
People employed in this industry face precarious work conditions every day, and labour rights violations have intensified since the coup d’état in June 2009.
Evangelina explains: “We were victims of a coup d’état by economically powerful actors, among them the major maquila investors. These industrialists have enormous power over State institutions, to such a degree that the National Congress backed by the industrialists is proposing a law entitled the Anti-crisis Work Law, also known as the temporary employment law. It will remove from 35per cent of factory workers entitlements guaranteed by the existing Labour Code such as vacations, Christmas bonuses, Social Insurance, maternity leave, statutory holidays, advance warning of termination and severance pay. The only right that workers will have under this law is the right to work four hours a day. The law is so abusive that it allows for in-kind payment of up to 30 per cent of the wages for these four hours. In other words, the workers can be paid in t-shirts. Sadly, factories are already beginning to implement the provisions of this proposed law even though it has not yet been passed.”
Although the situation for maquila workers seems dire,there is hope as the Choloma workers’ recent triumph demonstrates. Gina and Evangelina are emphatic that workers’ organisations and unions can effect change.They say: “We think that this achievement is very important and paves the way for workers to recognise the importance of being organised, because with unity and international solidarity, respect for labour rights and human rights can be secured, and the best way to do this is by forming a union.”
*Central General de Trabajadores de Honduras (the National Trade Union Centre of Honduran Workers)
The author would like to thank Lynda Yanz of the Maquila Solidarity Network/ Red de Solidaridad de la Maquila (RSM) for providing information and material on the workers’ struggle, as well as Evangelina and Gina for sharing with AWID their experiences of this important achievement.
[i] Interview with AWID.