New WRC Report: Direct Ship Americas (Honduras)

Dear Colleagues,

Please see here a new report from the WRC on the closure of the Direct Ship Americas (DSA) factory in Honduras and the prompt action of the university licensee Fanatics and the WRC to avert potential violations of worker rights and ensure compliance with university codes of conduct.

DSA, a producer of university logo apparel for Fanatics, shuttered its operations in December 2018, owing workers more than $450,000 in legally mandated compensation that the factory owner did not have the money to pay.

Fanatics committed, from its first communication with the WRC, to ensure that workers would be paid all money legally owed to them. Fanatics honored this commitment, asking its business partner, A Game Apparel International (AGI), to provide the necessary funds.

The WRC then worked with Fanatics, AGI, the Honduran authorities, and the workers to get the workers paid promptly and in full. The WRC established and maintained contact with workers, collaborated with the Honduran Ministry of Labor to prepare severance calculations for each worker, worked with Fanatics and AGI to organize and oversee the process for distribution of the funds, and successfully resolved a range of logistical and legal issues that arose.

Most workers received their compensation within one month of the formal closure of the factory and the remainder within several weeks thereafter, much quicker than in many other cases where factories have shut down and failed to pay severance. This swift and successful resolution has spared hundreds of workers who sewed university apparel a great deal of hardship.

Fanatics’ approach in this case is notable. University labor codes require licensees to ensure that workers are paid the money they legally earned. While universities and the WRC have had growing success in securing compliance with this obligation, it has often required a protracted engagement with licensees to get to a positive resolution. By acting forthrightly in this case to protect workers and uphold university labor standards, Fanatics has set a positive example for the industry.

Scott Nova
Executive Director
Worker Rights Consortium
[email protected]