Nike agrees to just pay it in Indonesian workers' compensation deal

Deutsche Welle, 12 January 2012 

The workers will receive around $1 million

US sports apparel giant Nike has agreed a compensation deal with workers at a subsidiary factory in Indonesia for over half a million hours in unpaid overtime. The workers' union says the fight has "only just begun."

A subsidiary of sportswear maker Nike has agreed to pay compensation to around 4,500 factory workers in Indonesia for over half a million hours in unpaid overtime.

An Indonesian trade union representing the employees from the PT Nikomas shoe plant in Banten province said Nike had agreed to pay $1 million following 11 months of negotiations.

The money will be distributed to the workers by early next month.

"The decisive actions taken by PT Nikomas Gemilang IY plant clearly demonstrate how seriously they are taking the allegations of workplace misconduct," Nike said in a statement. "Nike commends the factory on their action plan and efforts to correct inadequacies in current policies designed to protect the rights of workers."

Union chairman Bambang Wirahyoso said he hoped the case would set a precedent in a country where factory employees often work seven day weeks without overtime or proper benefits.

"This has the potential to send shockwaves through the Indonesian labor movement," Wirahyoso said in a statement, adding that his union was gearing up to fight for other workers. "We have only just begun."

Author: Darren Mara

Editor: Anne Thomas