Hrm Intro

HRM 107 Presentation – Friday 8pm
History and introduction

How would you like to know that the $125 shoes that you bought last month only cost $5 to make? Sweatshops, child labour and poor working conditions, these are the strong allegations that Nike Inc. has been blamed upon where lives are at risk, all for the production of sporty shoes and equipment

Nike since the early 1970’s has been accused many times for enacting unethical OHS matters in many of their factories worldwide, by opening and developing factories in developing countries such as China, Vietnam and Indonesia. The company once known as Blue Ribbon Sports in 1964 created at the University of Oregon is now a multinational organisation that is the leader of athletic footwear and accessories now known as Nike.
What o h and s is?

What is OH & S? OH&S stands for Occupational Health and Safety. It is basically a set of guidelines that employers must conform to in order to minimalize the dangers and risks of the workplace.
The main focus of OH&S is on two different objectives: * The maintenance and promotion of workers’ health and their working capacity. This involves organisations undertaking various strategies such as training programs and orientation days for new or developing employees in order to educate them in safe practices at the workplace. * The improvement of working environment and work to become conducive to safety and health. This includes things such as marking danger zones clearly, or wearing bright safety clothing or hard hats where appropriate.

There are three reasons occupational safety and health is a concern. That is: * There is a duty of reasonable care for an employer. It is unacceptable for a person to put the health and safety of another person at risk. * There are not only moral obligations being broken if OH&S guidelines are breached. In most cases, laws may be broken which could lead to prosecution of the employer or employee, depending on the severity of things. * This leads to the final reason. It is very costly to resolve these incidents. Though it may be more costly up front in creating preventative strategies for employees, it is a better investment than waiting for and dealing with individual infringements.

Problems

Developing countries such as these have minimal to no labour laws allowing Nike to exploit the countries human resources and in turn operate and function with minimal costs. Due to the lack of government intervention in these countries Nike was able to continue operations with mere compliance in regards to OHS rules and regulations.
Developing economies are often in need of foreign direct investment, meaning that the government will turn a blind eye to the poor working conditions in order to inherit the benefits that are entailed with the flows of foreign direct investment which Nike puts into the economies. With the onset of the twentieth century as well as the globalisation era, the demand for Nike’s products skyrocketed meaning that so too did the number of Nike factories in developing economies.
With activist groups constantly bombarding Nike with criticism regarding the factories working conditions as well as the global community beginning to notice the violations Nike was implementing, Nike had begun to put strategies in place in order to clear their tarnished name. Nikes initial attempt into installing a code of conduct occurred in the 1990’s and was called SHAPE, standing for Safety Health Attitude People and Environment. The company invests 10 million a year into this code. Even with the introduction of SHAPE, advocates worldwide were still campaigning for improved conditions for Nike factories worldwide, arguing that they were not safe working environments as well as the employment of child labour.
This video shows an example of the negligence that Nike inc. factories have towards their employees in terms of health.
Video here - http://www.youtube.com/watch?v=ciXdCpJxMWM
How they responded

Nike

2005 – 2006 – identified goals for systematic change for workers in the industry
2010 – “rewired” their approach to manage risks and opportunities * New safer manufacturing tools * The creation of teams to support each other and increase productivity and performance * created a new organizational structure within the company that brought together labour compliance, health, safety and environment, lean manufacturing, human resources management, climate and energy, waste and water management * created a sustainable supply chain” – i.e., one that includes sustainability on equal footing with cost, on-time delivery and quality

Labour
Wages
Excessive overtime
Freedom of association
HRM program implementation
Health, safety and environment

Another way Nikes response to these allegations was the introduction of factory assessments between 2002 and 2004. Each of their factories was audited multiple times; each factory would be given a score from 1 to 100, which would then be translated to a letter grade. Majority of factories were given a B, with only a few D scores. Once a factory was awarded a score of D, then Nike would threaten to shut down the factory unless conditions were quickly amended. This allowed the condition of factories to be quickly amended according to their condition; even after this the global community still argued that even though the physical conditions had improved the employment of children as well as low wages were still an issue. In response to this Nike introduced worker surveys in many of their factories in order to gain a better understanding of how the workers lives could be improved.
Is it working?