Labour Behind The Label

In January 2011, the owner of PT Kizone in Indonesia fled, resulting in the closure of the factory in April the same year, and leaving 2,800 workers without work and the severance pay they were entitled to. Sportswear brand adidas had been sourcing from PT Kizone for many years, where workers were paid as little as US$ 0.60 an hour.

So far adidas are refusing to pay a cent towards the compensation fund for PT Kizone workers.

Take action today! Fill in the form below to call on adidas to step up its game on workers' rights and demand justice for Kizone workers.

Re: PT Kizone (Indonesia): Outstanding severance payments I am writing to you to share my deep concerns regarding the payment of money owed to workers at your former Indonesian supplier, PT Kizone. I understand from Labour Behind the Label that PT Kizone in Indonesia closed in April 2011 after the owner fled the country. This has left 2800 workers without employment and owed US$3.4 million in severance entitlement. They are unlikely to be able to claim this money through any legal process. As a long standing buyer at PT Kizone adidas had responsibility for ensuring the factory was operating in a manner that was compliant with Indonesian law, international labour standards and adidas' own code of conduct. It is clear that adidas failed to do so as no funds to pay the workers’ severance were available. Therefore adidas now has responsibility for rectifying these violations and ensuring workers are provided with the severance pay to which they are legally entitled. Other buyers from the factory have now paid a total of US$ 1.6 million towards these debts, but adidas have so far refused to contribute. I am therefore calling on adidas to pay the remaining US$ 1.8 million plus interest to former PT Kizone workers. PT Kizone workers have spent many years producing goods for adidas and deserve to have their rights respected. As a consumer I am interested in the working conditions provided at your production sites. I therefore urge you to: pay the workers the outstanding US$ 1.8 million severance payments including interest; to offer the unemployed former-PT Kizone workers jobs at the same contractual conditions and not to discriminate against anybody because of age, demands made to adidas or other criteria; these jobs must be close to their homes to avoid tearing families apart; to engage positively in this process with the union representing the majority of the workers, DPC SPSI TSK; to act in accordance with the principle of due diligence in the future employment of these and other workers. Yours sincerelyYou must send a letter of some sort

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adidas claim that they have no responsibility to these workers as the last adidas product was completed in November 2010, prior to the closure of the factory. Yet severance pay is accrued over the whole period of employment. Therefore the workers are entitled to receive money earned over the several years of adidas’ production.

adidas also say they cannot assume responsibility for breaches of law committed by their supplier. Yet adidas do have responsibility for ensuring that all of the standards enshrined in local law, international conventions and their own codes are met. This is the principle behind corporate responsibility.

Therefore adidas need to take steps to ensure all labour rights violations, including the failure to pay monies owed to workers following illegal closure, are rectified. This means directly paying severance pay if it is not possible to get payments from the owner or the courts. So why do adidas continue to refuse to take action?

Email adidas to ask them! Take action now > >

In January 2011, the owner of PT Kizone in Indonesia fled, resulting in the closure of the factory in April the same year, and leaving 2,800 workers without work and the severance pay they were entitled to. Sportswear brand adidas had been sourcing from PT Kizone for many years, where workers were paid as little as US$ 0.60 an hour.

In July 2011, other buyers at the factory announced that they would contribute US$ 1.6 million to a fund to compensate workers, roughly half of the US$ 3.4 million that was owed to them. To date adidas has refused to contribute to the fund. Now, a year after the factory shut down, the workers are still legally owed the remaining US$ 1.8 million in severance plus interest, which means former workers are incurring debts to survive and may be unable to keep sending their children to school.

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