WRC Update: Nike Remediation Plan for Hong Seng Workers

I want to provide you with the WRC’s assessment of Nike’s current remediation plan for Hong Seng Knitting in Thailand:

• Nike’s decision to provide remedies at Hong Seng Knitting is good news for the workers. And it is an acknowledgement by Nike of the violations of university labor standards that the WRC identified in 2020.
   
• We are encouraged that university standards have been vindicated and meaningful corrective action taken. Without the WRC identifying these violations originally, and persisting for five years in seeking back pay, there would have been no remedy for these workers. I am proud of our team’s efforts on this case.
   
• Nike has committed to substantial back wages—hundreds of thousands of dollars. There are, however, some deficiencies in its plan:
  • workers will receive no interest on their back pay, even though it is five years overdue;
  • some workers will get paid leave instead of cash; and
  • most importantly, the compensation amount for the worker who had to flee the country to escape the factory’s persecution only addresses a fraction of the harm he and his family suffered.
     
• So, we can report that Nike’s plan represents substantial progress, though we cannot report that remediation is complete. Considering where Nike stood on this case over the past years, we have certainly come a long way.
   
• When the Fair Labor Association (FLA) published its Hong Seng report in December 2024, we expressed concerns about its methodology, findings, and recommendations.
   
• The FLA disagrees with these criticisms, but it has also made major changes to its public statement of findings on the case, which now go significantly beyond those in its investigator’s report. These changes bring its conclusions into much closer alignment with those the WRC reached back in 2020. This is also positive: both the WRC and the FLA now conclude that Hong Seng’s unpaid leave scheme was a violation of workers’ rights and that the police complaint the factory filed against the worker-leader was unacceptable retaliation.
   
• However, when it made these changes to its statement of findings, the FLA did not also update its recommendations. It is good, then, that Nike decided to provide workers twice as much back pay as the FLA has proposed. 
   
• Unfortunately, Nike did not go beyond the FLA recommendation on the other key issue: compensation for the worker-leader whom the factory forced to flee the country. The $1,746 the FLA’s investigator recommended is no more than the standard amount a worker in Thailand already receives at the end of their contract—a worker whose employment ends normally, whose rights are not violated, and who is free to seek new employment in that country.
   
• What this worker-leader experienced was very far from normal: he was targeted by the factory with a criminal complaint, just for criticizing its labor practices; was forced to flee the country with his spouse and infant child to avoid unjust imprisonment; was deprived of earnings for the remainder of his employment contract; and was stripped of the ability to work in Thailand in the future. The FLA properly calls this “unacceptable retaliation” in its revised statement of findings. Yet the FLA proposes, and Nike apparently agrees, that he and his family should receive no additional compensation for these harms.
   
• If such retaliation is unacceptable, then a worker who suffers it should receive compensation for the harm it causes. This issue is now the primary roadblock to a final resolution of the Hong Seng case.

As always, please let us know if you have questions or would like to discuss.