I am not 100% certain that the University of Wisconsin’s complaint about Nike’s responsibilities is fair. The important thing is that the University has thought the matter through, decided what the right thing to do is after serious analysis, and is taking principled action.
The Universityhas cancelled its licensing agreement with Nike to protest what it considers Nike’s inadequate efforts to help laid off workers in Honduras factories that make Nike products. Two factories that abruptly closed, both Nike sub-contractors, have not paid the $2.6 million in severance required by Honduras law.Under The school’s Code of Conduct commits the 500 companies that make products bearing the University of Wisconsin logo to take responsibility for their subcontractors’ actions. In rejecting Nike, Wisconsin will be forfeiting royalty income from its Wisconsin products.
Nike contracted with the factories, located in Choloma and San Pedro Sula, to produce apparel. They closed without notice in January of last year, and the legally mandated severance has yet to be paid. Nike has offered job training and has offered the dismissed workers priority for jobs at nearby factories. However, the Worker Rights Consortium, a labor rights watchdog, issued a report last month that the company’s response has been insufficient. That may not be fair: making a company liable for the salaries of its subcontractors may just cause companies like Nike to avoid poorer foreign factories, resulting in fewer Honduran jobs.
Wisconsin Chancellor Biddy Martin said, “”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.”
Wisconsin’s action may have a steam-rolling effect, and there will be pressure from student groups to get other colleges to follow its lead. Whether this will have any salutary effect on Honduras workers, or cause other, anticipated results that do more harm than good, is hard to know. The University is following the Davy Crockett motto: “Be sure you are right, then go ahead.”
That’s the formula for ethics heroes. It isn’t important whether I’m sure they are right, but that they are.