z Notes:

Beaverton, OR (July 1, 1997) -- NIKE, Inc. (NYSE:NKE) today reported record revenues and earnings for the Company's fourth quarter and fiscal year ended May 31, 1997. Fourth quarter net income totaled $155.8 million or $0.52 per share compared to $133.7 million, or $0.45 per share. Fourth quarter revenues were $2.37 billion, up 28 percent from $1.85 billion last year.* --Nike, Inc. - 4th Quarter Earnings Release


    Press Contact: Thuyen Nguyen, thuyen@spacelab.net

    Nike is trying to discredit its critics with misinformation

    Last week Nike provided misinformation to the public in its criticism of Garry Trudeau, the creator of the Doonesbury comic strip.

    In a letter to the South China Morning Post, Nike stated that its workers earn twice the per capita income of rural Vietnam. Nike, however, left out an important fact: Nike factories are not in rural Vietnam. Four of its factories are located in Dong Nai, just outside of Hochiminh City, and one factory is right in the city. The per capita income of the Hochiminh City area is $925 according to the World Bank. The entry level wage at Nike factories is only $480 per year.

    Nike also claimed that workers in Vietnam can save enough of their salary to send money home to their families. In March 1997, Vietnam Labor Watch has interviewed 35 workers at 4 Nike factories in Vietnam and none of those workers save enough money to send home. Nike also claimed that workers receive free medical care, English lessons and training classes. Nike workers in Vietnam do not receive free English lessons and training classes, nor do they receive free medical care. All factory workers pay for their own health insurance, which is deducted from their monthlypay check

    The only benefit that Nike factories provides to its workers in Vietnam is a subsidized lunch program. Nike factories report that the cost of a lunch is 27 cents; the factories pick up 2/3 of this cost, and deduct 9 cents from the worker's paycheck. Why then did Nike tell the public that the cost of a meal in Vietnam is only 9 cents in its response to Mr. Trudeau? The factory workers we interviewed in Vietnam told us that the cost of a meal where Nike factories are located ranges from 60 cents to 70 cents.

    Nike's accusation is just another attempt to discredit Nike's critics with misinformation. Nike has often used this approach in dealing with public exposure of its overseas labor practices.

    On May 23 1997, Liz Dolan, Vice-President of Communication at Nike Inc., distributed a letter to the press accusing Vietnam Labor Watch (VLW) of releasing an inaccurate eport about Nike factory workers in Vietnam being laid off. Vietnam Labor Watch has not published any report or press release about this issue. VLW has provided information to the press in April 1997 about a strike of 1300 workers at a Nike factory and a report on Nike labor practices in Vietnam in March 1997.

    For the past several years, Nike has maintained that workers in its Indonesian factories earn twice the country's minimum wage. This claim was proven false last month when 10,000+ workers went on strike several times at Nike Indonesian factories because they did not even receive the new minimum wage. During the strike, Nike told the press that its factories pay Indonesian workers the bare minimum wage.

    In May 1997, Nike factories in Vietnam also discontinued the practice of paying workers below the minimum wage for the first 90 days of employment.

    The company, however, continued to claim that its factories did not violate Vietnam's minimum wage law in 1996 and 1997. VLW's March report provides employee paystubs which document the practice of paying a sub-minimum wage beyond the legal period. A central recommendation to Nike in that report was to get rid of this practice. VLW is glad that Nike has implemented one of its recommendations.

    Nike even provided misinformation about its overseas factories to its own shareholders. By September 1996, many Vietnamese newspapers published articles about 15 women workers who were hit on the head by a Nike factory supervisor. But at a shareholders meeting at Nike's headquarters, Mr. Knight minimized the story into an incident involving only one worker who was hit in the arm by a supervisor. In the same speech, Mr. Knight also tried to minimize a sexual abuse incident involving a factory manager and two women workers at another Nike factory, Tae Kwang Vina.

    Mr. Knight said that the incident was just a misunderstanding when a night watchman was trying to wake up these two workers. He ignored the fact that the two women told a horrifying story to the Vietnamese press of an attempted rape by a Nike factory manager. This factory manager left Vietnam before the Vietnamese authorities could put him on trial. picture of actual paystub from Sam Yang Vietnam Co., with annotation Exhibit 1. An actual paystub of a worker at Sam Yang Vietnam Co., a Nike factory in Hochiminh City. The above is a paystub demonstrating that the worker pays for her own health insurance as well as 9 cents for a subsidized lunch per day.

    The paystub also shows that the worker's basic salary is only 387,000 VND (Vietnam Dong) or 35 USD which is below the minimum wage of 45 USD per month. This worker also worked 26 days in December 1996 plus 37 hours of overtime and 8.5 hours on Sunday. The number of hours that she worked in December 1996 is 253.5 hours and her take home pay was 491,000 VND or USD $44.63, or 17 cents per hour. The worker behind this paystub represents a typical case of the 500+ workers that are about to be laid off at Sam Yang as indicated by Nike in its recent press statement due to a production slowdown. VLW hopes to call attention to the exploitation of these workers who have worked many hours of overtime, getting below minimum wage for the first 90 days, who are now being laid off just as they are about to receive the minimum wage.

    Policy Office
    Music Industry Human Rights Association
    tele  +44 181 742 2803
    fax   +44 181 742 2491
    UK Homepage  http://www.cerbernet.co.uk/mihra
    email mihra@styx.cerbernet.co.uk
    Founded in respect of UN50, MIHRA INTERNATIONAL represents all areas of music, its industry and its cultural and economic activities.

    (Attempt made 6/10/97 to contact Nike for reply - no email found on Nike website-ed)

    See also:

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