Will Wisconsin Sever Ties with Adidas?

Last Updated on June 5, 2014

Author: Tyler Jamieson

A couple of weeks ago Cornell announced it was severing ties with Adidas over its labor practices.  Now it appears Wisconsin is looking to be next in line to do so, and Wisconsin is willing to put its money where its mouth is for the cause.

Wisconsin’s current deal with Adidas runs through 2016 and is worth approximately $2.5 million annually. The University also receives licensing royalties from Adidas that have provided hundreds of thousands of dollars for need-based scholarships for students outside of athletics.  However, the University is willing to sacrifice all that for its stance against sweatshop abuses in licensed-apparel manufacturing.

At issue is an Indonesian factory that was shut down by an Adidas subcontractor.  Over 2,800 factory workers were owed $3.2 million.  A small part of the factory produced Adidas apparel and some of that apparel was found to have Wisconsin logos on them.  Other companies such as Nike and the Dallas Cowboys, who presumably had items that were manufactured there, have provided financial relief for factory workers, but to date Adidas has not done so and factory workers are still owed $1.8 million.

Is Wisconsin’s cause a noble one?  Critics of the NCAA aren’t so sure.  It’s not uncommon to hear the term “slave labor” tossed around when referring to NCAA athletes.  Is it hypocritical for a big-time university like Wisconsin to take a stance on labor wages in the manufacturing of their apparel when it can be argued their returning 1st team All American and Heisman trophy finalist running back, who led the team to a Rose Bowl berth last season, is grossly under-compensated?

To its credit Wisconsin is consistent with its belief. They pride themselves on being at the forefront of aiming to stop labor abuse in licensed-apparel manufacturing and they have the history to prove it.  This isn’t the first, second, or even third time they have ended license and apparel contracts over labor practice disputes.  In 2008, the University ended its license agreement with New Era over labor practices.  In 2009, the University ended its relationship with Russell over a closure of a factory in Honduras where it was alleged the factory was shut down as a hostile response to workers who were threatening to unionize.  In 2010, Wisconsin ended its licensing agreement with Nike due to a similar circumstance as Adidas – a Nike subcontractor closed 2 factories and was alleged to have owed workers approximately $2 million in severance pay.

For now, Wisconsin is keeping tight-lipped on the dispute with Adidas due to pending litigation.  Both sides agreed to mediation back in February, and after being unable to find a resolution the Wisconsin Board of Regents put the case in the hands of a court to decide if Adidas has met the Labor Code of Conduct term of their contract.  Should be interesting to see the outcome of this case and to see if other schools will follow Wisconsin’s lead.

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  • Evin
    September 27, 2012

    Interesting. What made Cornell take action? Before that school, had there been precedent?

  • Derek
    September 27, 2012

    It’s difficult to draw comparisons between sweatshop workers in third-world countries and college athletes in the U.S. who receive full-ride scholarships to universities that help prepare them for successful careers beyond football. There’s still a very good social debate to be had about whether college athletes should be compensated for the money they help generate for their schools while not being allowed to hold jobs themselves.

    Good for Wisconsin for being proactive. The school could easily plead ignorance and be reactionary if/when it became a big social issue. Instead, they’re choosing to be on the forefront.

  • D. Wiegand
    May 30, 2014

    How are scholarahiped athletes under paid? Education, room, board, books, tutors, best fitness facilities, nutrition a list, dietitians, etc. Your telling me that they who receive more than any other college student and don’t owe a penny. How hard does someone work to pay off student loans? It takes people countless years to pay for college. They walk out debt free. For some of these student athletes if it was not for sports they would not even be in a school. They are more than paid. They receive a free education and get the luxurious opportunity to play sports and possibly play the next level, all the while building better charictor. Paid they are greedy they are more than anything if demanding pay.