Normally this is the place you come for a ton of links and looks around the Internet for news and notes on the Badgers. But not today, and that's because there is a very interesting story that's really being under reported outside of Madison itself and that's the issue of the athletics department contract with Adidas as it's official athletic apparel supplier. The university has a policy that doesn't allow for it to have a contract with a company that has unfair labor practices. As we speak there is a major dispute going on about a plant in Indonesia that could derail Adidas as the athletic apparel supplier.
If you aren't familiar with the issue there is a dispute about workers not being paid by the owners of the PT Kizone plant in Tangerang, Indonesia who closed the factory without notice and currently there is about $1.8 million owed to workers that were left without jobs.
That issue violates the University's policy about companies it contracts with and their labor practices. However, on the other side of the issue is the fact that according to Adidas they stopped using the plant about 10 months before this issue occurred and had made full payment to the plant for it's work on the contracts.
Adidas also says it's encouraging it's suppliers in the area to hire workers from the plant for open positions and investing in job placement programs for those workers.
It is believed that the Labor Policy Committee recommended that Ward put Adidas on a 90 day notice for violating the Labor Code of Conduct, a code that a dozen or so universities adhere to including Wisconsin. But it appears that Interim Chancellor David Ward and adidas are going through mediation, a process that could take around 60 days.
You may be asking "what is the Labor Code of Conduct?" It roughly reads that it requires licensees to agree to operate work places and contract with companies that adhere to certain standards regarding wages and benefits; child labor; and health and safety.
So, what are Barry Alvarez and the athletic department going to do should the university decide to terminate the contract? Right now the contract generates around 2.7 million dollars annually for the department and with being in the middle of some major capital projects that 2.7 million dollars is really needed to help in that funding as well as the operations budget of the department.
The bigger issue at hand is who could the Badgers get to replace Adidas as a supplier. Could it be Nike? That's a no, because they had an ongoing contract with the plant in question at the time of it's closing and were "blacklisted" by this same committee in 2010 for practices at a Honduran plant. Reebok? Owned by Adidas, so that's a no go. What about up and coming Under Armour? According to Barry Alvarez "they have labor issues."
So the athletic department is really left between a rock and Adidas at this point.
Look, I'm all for paying those workers that were hurt by the illegal and unfair closing of the plant by those with contracts at the time and my heart goes out to those that were affected by that closing. However, what I don't get is possibly terminating a contract with an athletic apparel supplier that clearly had not been using the plant at the time of it's closing.
Unless Adidas is flat out lying when it says that it hadn't had a contract with them in 10 months and made it's full payment to the plant when the contract was done I don't see where they can be held responsible for the actions of the plant owners. I'm also guessing it's pretty easy to find out if those statements by Adidas are true by getting the formal paperwork from them about the contract and checking payments made.
But let me get this straight, the committee can't really be saying that Adidas should be held responsible for the actions of a factory that they weren't contracted with at the time of the plant closure when they had all of their commitments met are they?
It sure appears that way, huh? I know that common sense has been gone for a long time in this country, but it can't be that full on academically astute individuals like a chancellor and university committee members really think that Adidas is responsible for paying severance pay to workers at a plant they weren't using at the time of it's disputed closing, right?
Lets put this another way, the policy that's in place is like you or I paying someone to build us a house, as the house is going up we make the payments and finish the payment upon completion of the house and nearly a year after that the company goes bankrupt and it's found that they weren't paying their employees their wages or severance pay. Should we as the person who received the service long before the company went belly up be responsible for paying the wages of the employees left in the cold, even though we made the payment to the company for their services to us?
I understand the policy was put in place to try and pressure companies against unfair labor practices and I'm all for that, but this isn't a case of creating a "sweatshop" environment by the practices of Adidas nor did they fail to pay the company for the services it provided them.
The committee seems to act as if adidas is guilty of beating their contracted workers and holding them to 16 hour work days under slave labor. I'm pretty sure that eliminating those practices was the intent of this "Labor Code of Conduct," right?
It seems that perhaps the university and the Labor Policy Committee need a dose of common sense served to them. Or perhaps the people that make up the Labor Policy Committee could start their own Wisconsin made and based apparel company? One that would provide for and maintain the standards they are looking for, but I'm guessing they'd find out real quick that doing so would also make apparel really expensive and not a viable product to sell to the fans and provide for the student-athletes.
On a related note, if this is such a bad labor practice I'd hope Chancellor Ward and the Labor Policy Committee has cleaned out their closets of all Wisconsin Adidas apparel, after all they are evil wrongdoers right?
Common sense should tell this committee it needs to revisit what is considered "unfair labor practices" and begin to draft a policy based on reality and not some ideal world where everyone is perfect all the time. Their are evil people in this world and apparently the owners of the plant in question fall into that set, but punishing Adidas for that is equally as wrong.
Even worse would be leaving the athletes that represent the university in a lurch in the facilities they need to succeed on and off the field because of a badly written policy that could cost the Badgers $2.5 million or more and pretty much scare off any company looking to do business as an athletic apparel supplier in the future.
If you were a business would you really want to enter into a relationship with a university that would terminate your contract for something completely out of your control or force you to make severance payments to employees that you had no contract with at the time of a disputed closing of a plant? I know as a businessman myself I wouldn't put my company in that position ever, so I'm pretty sure the heads of up and coming apparel companies in the United States are going think twice about it.
Additionally if they were to cut ties that means a ton of licensing fees are gone as well and the university uses the money from those fees to fund need-based scholarships, so not just the student-athlete would be hurt by this choice.
Amazingly, Indiana, Michigan, and Northwestern seem to be fine with what Adidas has done in regards to this plant closure, so why isn't it good enough for an equally high quality university like the University of Wisconsin-Madison?
In the end it's really up to Interim Chancellor David Ward to take this 90 day period and use some common sense. Hopefully all will be settled to satisfaction and a mutually beneficial relationship between the school and Adidas can be maintained or a viable alternative can be found, but with the way things seem to be going I'm not holding out hope and that's a shame for fans, students, and the university.