Eastern holds Adidas contract discussion

Eastern’s Walter Kraft, Geoff Larcom and Gloria Hage met with two workers affected by the issue, as well as student organizations that have been vocal about it.

Two workers from a closed-down factory in Indonesia visited Eastern Michigan University Wednesday to ask the university to sever its contract with Adidas and discuss their issues with the company.

Members of United Students Against Sweatshops and Students for an Ethical and Participatory Education, the student organization that has been advocating for the termination of EMU’s contract with Adidas since October 2012, were present at the forum, which took place in Porter Wednesday.

The visiting workers, Aslam Hidayat and Heni, are angry at Adidas for not compensating PT Kizone factory workers with more than $1.8 million worth of legally mandated severance pay and wages after the factory shut down abruptly and its owner fled the country.

The workers are asking EMU to sever its contract with Adidas.

Hidayat said the university needs to take action because Adidas is refusing to recognize workers’ rights.

“We hope the administration at EMU will take solidarity with us and will cut the contract with Adidas,” he said.

Heni, a 43-year-old Indonesian woman, does not have a last name, which is typical in Indonesia.

“The sweat of our labor has made Adidas profitable for years,” she said. “In those clothes, the sweat of our labor still remains.”

EMU’s contract with Adidas began in June 2010 and is valid until May 2015. The company offers the school 45 percent off retail price for all athletic footwear and 50 percent off all athletic apparel and equipment.

In exchange for $275,000 of wholesale spending, Adidas offers the Athletics Department 50 footballs, 20 basketballs, $90,000 worth of products at retail and various bonuses totaling $10,500 of product at retail.

Adidas is one of several brands that contracted large amounts of work out of the PT Kizone factory.
However, according to International Labor Rights Forum, of the three brands that contracted the largest amount of work, Adidas is the only company that has refused to offer severance pay; Nike and the Dallas Cowboys both having paid portions already.

Heni said her living arrangements have changed drastically for the worse since the factory abruptly shut down, and she is unable to properly care for her three children. One of her daughters has recently dropped out of school because she can’t afford the fees to attend.

Heni and her husband, 48, are both out of work after being employed at the PT Kizone factory for 13 years.

“My husband was sick and couldn’t afford medicine, and at one point we had nothing to eat but leaves that grew in the backyard,” Heni said. “We couldn’t even afford rice. We never dreamed we
wouldn’t receive our severance.”

The PT Kizone factory closed April 6, 2011, and over 2,700 workers suddenly lost their jobs. The government auctioned off the remaining equipment, and the workers received vouchers from Adidas. The workers who visited EMU said this was unacceptable.

“We protested in front of the U.S. and German embassies,” Hidayat said. “We also protested the main Adidas building in Jakarta. Whenever we would protest, we received vouchers but no pay.”

After the talk in Porter, Heni and Hidayat met with EMU’s Vice President of Communications Walter Kraft, Director of Media Relations Geoff Larcom and general counsel Gloria Hage in Welch Hall.

Some of the students who attended the talk went to the Welch conference room as well.

Following talks with members of SEPE, EMU administrators sent a letter to the athletic apparel company on Jan. 28. Larcom said they’re expecting a response by the end of the month.

Kraft said, “We have a contract with Adidas, and we have to get a formal response in order to get a dialogue started with them.”

In the letter, EMU administrators said their understanding is that Adidas was obligated, under Indonesian law, to pay severance to the displaced workers of PT Kizone.

“Is Adidas formally or informally denying legal and ethical responsibility to pay the workers who were displaced when the PT Kizone factory closed?” the letter asked Adidas. “If Adidas is denying responsibility for severance to the workers, who does Adidas claim is responsible to pay severance?”

The letter also asked Adidas to explain the basis for the denial of severance and to attach any documentation that supports that explanation.

Kraft said any action would first require a response from Adidas.

In a press release dated July 23, 2012, Adidas said, “Because it has fully honored its contractual obligations at the plant, the Adidas Group will not accept nor assume the financial duties of the former PT Kizone owner and pay severance to the workers.”

EMU senior and SEPE member Josiah Seng said the administration needs to make a move on this issue.

“They probably want to see Adidas remedy the problem before EMU cuts, but getting results requires action and former PT Kizone workers can’t wait,” Seng said.

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