severance theft was Nike’s payment, in 2010,
of the entire $1.54 million in unpaid severance owed to 1,450 former workers of the
Hugger and Visiontex factories in Honduras, which, prior to their closure, had supplied Nike with university-logo apparel.46 In
other, more recent, cases, contributions to
correcting severance theft made by brands
that are university licensees have served as a
crucial catalyst for other buyers to also provide funds to remediate the violation. Other
brands that have made such contributions
or caused them to be made on their behalf
by buying agents or other intermediaries
include adidas, Fanatics, Fruit of the Loom,
the Dallas Cowboys, Gap, Gildan, Hanes,
Levi Strauss, and Tailgate (American Eagle
Outfitters).47
In some cases, interventions by the WRC
and other labor rights advocates have secured substantial funds from brands for
workers owed severance by a former supplier, even when the factory in question had
never produced under a university license.
For example, in 2013, Jerry Leigh, a maker of Disney-branded apparel, paid nearly
$278,000 to make 200 workers whole for unpaid severance owed by its former supplier
factory Hawkins Apparel.48 More recently, in
January 2020, Gap, Hanes, and American
Eagle paid $1.3 million in severance to 500
workers at their former supplier factory in
Guatemala, CSA.49
When Brands Resist Accountability
for Severance Theft, Justice for
Workers Is Delayed and Denied
In many cases, however, efforts to secure
remedy for severance theft, even where ultimately successful, have involved protracted,
multiyear efforts, during which workers continue to be denied funds that should have
been paid on the day of their dismissal—
and, as a result, fall into debt and destitution. In January 2011, the PT Kizone factory
in Indonesia, which had supplied university
licensed apparel to adidas and Nike, closed,
owing its 2,800 workers $3.3 million in severance. While partial payment to workers was
secured by Nike in reasonably short order,
via a contribution by its buying agent, most
of the severance owed to workers was not
paid until more than two years later, and only
after adidas, having been challenged in court
by a major university over alleged breach of
contract and facing a public campaign by
college students around the US, reached a
settlement with the workers’ union to pay
the $1.8 million still outstanding.50
In other cases of mass severance theft, sometimes involving buyers less sensitive to public criticism, remedy remains only partial, or
lacking entirely, even a half-decade or more
after factories have closed. The PT Jaba
Garmindo factory, also in Indonesia, closed
in 2015 owing its 4,000 workers more than
In many cases, efforts to secure remedy for
severance theft, even where ultimately
successful, have involved protracted,
multiyear efforts, during which workers fell
into debt and destitution.
WRC
yz
Fired, Then Robbed
zy
Page 10