Business Ethics – Nike Case Essay

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Introduction

The dispute between Nike and the University of Oregon began when the University of Oregon joined the Workers Rights Consortium. Nike which is a founding and active member of the Fair Labor Association viewed this as a breach of trust. The WRC is a non-profit organization formed by college and university administrations and students as well as human rights personnel to ensure that sports apparel bought by colleges and universities are not manufactured under inhumane conditions (Pilgrim, 1999). The University of Oregon claimed that the sports apparel it purchased from Nike was not manufactured under gross conditions. The dispute between the two parties culminated into the withdrawal of philanthropic money donated to the university by Nike. The dispute left many lingering questions about the best way to monitor and enforce fair labor standards.

Main body

Labor standards encompass many aspects and include minimum age of workers, a living wage, abuse (or lack thereof) of workers, working conditions and overtime compensation among others. The manufacturing of Nike’s products is not carried out in the United States or any other developed country. Instead, it is done in the third world countries such as Indonesia, Vietnam, Korea and China which have a comparative advantage in labor. The corporation has been accused on a number of occasions of unfair labor practices such as employment of underage workers majority of whom are women and vulnerable to abuse; forcing workers to work under inhumane working conditions; the lack of a living wage to the corporation’s workers and forcing workers to work overtime without compensation, among others. These unfair labor practices can be avoided and replaced by fair labor practices. However, a number of strategies must be put in place for this to be achieved.

Independent monitoring of the corporation’s factories is paramount in ensuring that fair labor standards are practiced. The monitoring should be done by an independent and non-partisan organization which has no connection and no interest whatsoever in the corporation (Haney, 2004). This will help to avoid the possibility of corruption, influence and control by the corporation. The monitoring should also be done on a spontaneous basis, that is, without giving prior notice to the corporation. This will ensure that the corporation upholds humane working conditions and treats its workers well at all times.

Public disclosure of the production is a second strategy that can be used to ensure corporations like Nike practice fair labor standards (Haney, 2004). This involves allowing the public and the media into the production facilities to see what goes on at every stage of the production process. This would enhance the transparency of the corporation’s production process. The public would be able to see first hand the conditions under which the workers work; for instance, whether or not they wear protective garments such as gloves while working.

Conclusion

Lastly, fair labor standards can only be upheld if the corporation pays a minimum living wage to its workers. This was one of the major sources of the dispute between Nike and the University of Oregon. While the WRC insists on an adequate minimum living wage, its counterpart, the FLA does not. A living wage ensures that workers are able to meet all their basic needs including those of their immediate family members without difficultly (Haney, 2004). In sum, the FLA is a public tool used by major corporations such as Nike to pursue their own interests without taking into account the interests of their workers. The WRC on the other hand is concerned with the welfare of the workers and has good policies which, if followed, would help to enforce fair labor standards.

References

Haney, D. (2004). Good help or bad? Web.

Pilgrim, B. (1999). Phil-Anthropy vs. WRCcountability. Oregon Commentator. Web.

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