MONTREAL/TORONTO/PITTSBURGH - The United Nations has responded to an appeal by US and Canadian unions to review Nike’s affiliation with the UN Global Compact because, the unions contend, Nike (NYSE: NKE) systematically violates workers’ rights.

The UN Global Compact is an initiative that corporations seeking to cast themselves as socially responsible affiliate to. In doing so, they commit to make the nine Compact principles- concerning human rights, labor rights and the environment- part of their strategy, culture and operations. Nike affiliated itself to Compact in 2000.

In a letter to the UN dated April 14, Presidents of four unions representing over three million workers in the US and Canada claimed that Nike systematically violates Compact’s Principle Three, that businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining.

In the UN response dated April 22, Global Compact Executive Head Georg Kell does not deny that Nike systematically violates workers’ fundamental rights. He does not claim that Nike upholds any of Global Compact’s human rights, labor rights or environmental principles.
Kell refers the unions to the International Labor Organization (ILO), which he states is the “guardian” of the Global Compact’s labor principles. The unions are considering appealing to the ILO Committee on Freedom of Association as a next step in forcing Nike to meet its labor commitments under Global Compact.

In their letter to the UN, the unions claim that Nike’s historic absence of union representation and decimation of union representation at facilities that it acquired demonstrate that Nike systematically violates workers’ association and collective bargaining rights. The unions cite Nike’s ongoing restructuring at its Bauer Nike Hockey subsidiary.

In 1995, when Nike purchased Bauer, the hockey apparel and equipment producer employed over 1,100 union-represented workers at three facilities in Canada. Bauer Nike Hockey recently announced plans to shut two of the facilities and drastically downsize the third. Aside from Bauer Nike Hockey, none of Nike’s over 23 thousand employees are unionized.

Shortly after appealing to the UN, following repeated requests from the unions, Bauer Nike Hockey CEO Chris Zimmerman participated with the unions’ presidents in a conference call. The presidents offered to enter into a constructive dialogue with the Company over how it could continue to operate its unionized facilities in a way that is beneficial for both Bauer Nike Hockey and its employees. The Company has failed to express a willingness to enter into this dialogue.

The unions that submitted the letter are the CLC, GMP, IWA Canada and USWA. The Canadian Labour Congress (CLC) brings together 2.5 million workers that are members of over 100 affiliate unions in a host of industries throughout Canada. The Glass, Molders, Pottery, Plastics & Allied Workers International Union (GMP) represents 50,000 workers in a broad range of industries in the United States and Canada.

The Industrial, Wood and Allied Workers of Canada (IWA Canada) represents over 50,000 workers in the forestry, manufacturing, building materials and other industries throughout Canada. The United Steelworkers of America (USWA) is a diversified union representing over 500,000 workers throughout the US and Canada primarily in the metals, manufacturing and mining industries as well as the service sector.

United Steelworkers (USW)

United Steelworkers (USW)

The USW is the largest industrial union in North America with 850,000 members. It represents workers employed in metals, rubber, chemicals, paper and mining, plus the energy sectors of oil refining, nuclear, gas and electric service utilities, wind, solar and bio-fuels.

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