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adidas Group extends help to displaced factory workers in Indonesia

Workers’ union moves to dismiss lawsuit + + + Focus shifts to industry, labour alliance efforts to address unethical factory closures worldwide

April 24, 2013

Herzogenaurach, 24 April 2013 – The adidas Group today announced that it will contribute additional aid to workers in Indonesia displaced by an unethical apparel factory closure.

Hundreds of displaced PT Kizone workers failed to receive severance payments from the former owner, who fled the country in January 2011, causing the factory to close in April 2011. The latest support comes on top of $525,000 in humanitarian aid as well as job placement services, and advocating issues related to workers’ rights.
“We remain sympathetic to the plight of all former PT Kizone workers,” said Glenn Bennett, member of the adidas Group Executive Board, responsible for Global Operations. “This additional assistance will provide direct relief to workers and their families still impacted from the unethical factory closure. At the same time, we strongly encourage our university partners, industry leaders and workers’ advocates to join our efforts to pursue socially responsible and sustainable business practices to influence positive change within the global supply chain.”
The Indonesian district labour union representing former PT Kizone employees – Dewan Pimpinan Cabang, Serikat Pekerja Textil, Sandang Kulit-SPSI Kabupatan Tangerang – will ask the Wisconsin state court to dismiss its claims against the company as a result of the settlement.
“The union and the workers are very pleased that adidas has made this settlement, which will have a real impact on the workers’ lives,” said a representative of the Indonesian district labour union. “Now we can put the lawsuit behind us.”
The focus now turns to the Global Forum for Sustainable Supply Chains, which, along with the adidas Group and other industry, labour and workers’ rights groups, will pursue sustainable solutions to address issues created by unethical factory closures worldwide. The adidas Group is hopeful that there will be a renewed commitment from these stakeholders to continue productive dialogue over how to best address complex issues surrounding unethical factory closures which continue to put workers’ severance and unemployment entitlements at risk.
“We are continuously exposed to complications resulting from lapses in governance across the global market economy and supply chains. This poses risks to all stakeholders – buyers, workers and consumers alike,” Bennett continued. “The industry-wide initiative led by the Global Forum for Sustainable Supply Chains represents a meaningful step towards long-term change in addressing what workers’ advocates, industry experts, universities and brands are all after – an end to the problem of unethical factory closures and better protection of workers’ unemployment and severance rights. This remains an ongoing priority for the adidas Group and is critical to our business. It is also the right thing to do.”
The adidas Group will continue its long-standing commitment to take an active role promoting and enforcing workplace standards based on the International Labour Organization's core labour rights conventions, which protect and improve worker experiences worldwide. In 2012, the company held more than 170 training sessions and workshops for suppliers, licensees, workers and adidas Group employees and managed more than 1,560 factory audits around the world, many of which were carried out by external groups including the Fair Labor Association. 2012 marked the thirteenth consecutive time that the adidas Group was featured in the Dow Jones Sustainability Index. For more information about the adidas Group‘s continuing efforts, visit this website's sustainability section.

About the adidas Group

The adidas Group is one of the global leaders within the sporting goods industry, offering a broad range of products around the core brands: adidas, Reebok, TaylorMade, Rockport and Reebok-CCM Hockey. Headquartered in Herzogenaurach, Germany, the Group has more than 46,000 employees and generated sales of EUR 14.9 billion in 2012.