Nike has reached a settlement to compensate 1000’s of former garment staff at a Thai provider following a multi-year investigation into pandemic-era wage theft allegations.
The funds made to roughly 3,300 staff relate to a Bangkok manufacturing unit owned by Hong Seng Knitting that manufactured Nike attire and accused to have coerced staff into accepting unpaid depart in 2020 in accordance with an preliminary investigation by labour organisation Workers Rights Consortium.
In December 2024, a separate investigation commissioned by the Fair Labor Association, a human rights monitoring organisation that counts Nike as a member, really useful the model assist compensate staff who had been furloughed with out pay by a provider. However, it concluded that there was no proof of systemic coercion or unlawful motion on the a part of the manufacturing unit or model, however as a substitute recognized a number of “significant issues,” together with poor communication, Nike’s sudden exit on the pandemic’s onset and a scarcity of any complaints mechanism.
The FLA’s investigation was aware of criticism from a number of labour advocacy organisations together with Clean Clothes Campaign and the Worker’s Right Consortium for failing to defend employee’s rights and recognise that coercion, intimidation and abuse led to staff being denied pay. Central to this criticism was the case of garment Burmese migrant employee Kyaw San Oo, who turned a distinguished advocate in the course of the dispute and confronted retaliation within the type of a prison expenses.
In early 2025 primarily based on the FLA’s advice, Nike agreed to pay staff like San Oo, who didn’t signal the documentation to voluntarily decide out of being paid their full wage in the course of the pandemic. Since then the model has compensated all the wages for unpaid depart days taken in 2020 to all staff. While staff who’re nonetheless employed at Hong Seng have obtained compensation within the type of paid depart, those that have left have been paid out in money, in accordance with the FLA’s most up-to-date replace on the investigation. The newest report additionally famous that any unused depart will likely be cashed out on the finish of 2025.
However, probably the most notable end result of the pay out was for Kyaw San Oo. In December, after 5 years the WRC confirmed that the employee obtained a compensation of $42,000 for the retaliatory hurt he suffered, a rise from the roughly $1,800 Nike agreed to primarily based on the advice of the FLA’s 2024 report on the case.
San Oo’s case drew the FLA a lot consideration together with inner battle inside the organisation, main board member Nazma Akhter, founding father of Bangladeshi labour organisation AWAJ basis to resign from the board in protest, which labour advocacy teams say propelled Nike’s resolution to supply the compensation quantity finally agreed upon. It marks one of many largest compensation settlements within the garment trade to a single employee.
Nike stated that when it turned conscious of the allegations at Hong Seng Bangkok in 2020, it promptly labored with a third-party investigator and authorized counsel to evaluation and examine. While the model famous that a number of investigations discovered that the impacted staff had been compensated in accordance with native legislation and Nike’s code of conduct, it usually encourages its suppliers to go above and past authorized necessities
“We were glad to collaborate with involved parties to bring final resolution to this case, in alignment with the FLA’s conclusions and recommendations,” it stated.
The end result “affirms that corporations are accountable for the abuses in their supply chains,” stated Clean Clothes Campaign in an announcement. It famous that the ultimate cost to San Oo “raises the stakes for brands that would disregard migrant workers’ human rights and the right to organize.”
Learn extra:
Nike Told to Compensate Workers in High-Profile Labour Controversy
An unbiased investigation commissioned by The Fair Labour Association — a human rights monitoring organisation that counts Nike as a member — recognized a number of ‘significant issues’ in a long-standing case of alleged wage theft.