Indonesia is a key manufacturing base for Nike with 40 factories, employing some 171,000 workers producing footwear and apparel for the company.
Following mass protests, workers were awarded a 44% rise in the minimum wage to 2m rupiah ($228) a month, due to come into effect on 1 January. The minimum wage is regulated at a local level by provincial governments but there has been speculation that some factories will be given exemptions to the rise because they are deemed as unable to afford the additional costs.
Following factory visits by US NGO Education for Justice (EFJ), Jim Keady, head of the EFJ, said that at least six of Nike’s suppliers had applied for an exemption with one, located in the Javanese city of Sukabumi having secured approval from authorities to pay 1.1m rupiah rather than 1.2m, which had been set by the provincial government.
Surya Tjandra, director of Indonesia’s Trade Union Rights Centre, told Yahoo! News that while those seeking exemptions appeared to be Nike’s local contractors, the company was ultimately responsible for ensuring its code of conduct was upheld.
In response global corporate communications director at Nike Greg Rossiter told AFP: “Nike takes these claims seriously and company representatives are investigating the claims.”
He added that the company expected workers producing for Nike to be “paid at least the minimum wage required by country law and provided legally mandated benefits”.
