News about Our Work - 13 March 2018 Infringement of OECD Guidelines for Multinational Enterprises-SOUTHWIND files complaint against Adidas The SOUTHWIND Institute accuses Adidas of failing to comply with its corporate due diligence obligations in the event of the unlawful dismissal of more than 300 former employees of its Indonesian supplier Panarub in 2012. In doing so, Adidas has violated the OECD (Organisation for Economic Co-operation and Development) guidelines for multinational companies. SÜDWIND, a member of the Clean Clothes Campaign, will therefore file a complaint with the OECD against the Adidas Group. In July 2012, around 2,000 employees of PT Panarub Dwikarya, part of the central Adidas supplier Panarub Group in Indonesia, went on strike. They demanded payment of the minimum wage in force since January 2012 and their right to freedom of association. This was preceded in February 2012 by the dismissal of several employees who had tried to found a works union. On 23 July 2012, 1,300 workers who participated in the strike were dismissed. To date, more than 300 of the dismissed (mostly women) have not received any compensation, although this is legally obligatory. According to Indonesian labour law, each lay-off is entitled to a severance payment, the amount of which is in relation to the duration of their employment. The purpose of the complaint is to encourage Adidas to exercise its influence over Panarub and to help employees receive the compensation they are entitled to: Adidas shoes were proven to be produced in the said factory in the first months of 2012. Adidas is still one of Panarub's biggest customers (alongside an Asian client). ‘Adidas is thus jointly responsible for the violation of labour rights at the Panarub Group’, says Dr Sabine Ferenschild from SÜDWIND. What's more: Adidas has even actively contributed to this violation, as the company has failed to provide PT Panarub Dwikarya employees with access to redress. This is where the OECD guidelines come in: They formulate recommendations for responsible business conduct in a global context. The complaint is also based on the assessment of the case by the International Labour Organization (ILO) Oversight Bodies: This clearly states that the dismissal of the Panarub workers was unjustified and constituted a violation of the fundamental right of workers to freedom of association. "So far, there is no legal instrument to hold multinational companies accountable for labour and human rights violations in their supply chains," Ferenschild continued. "However, the OECD complaint process, which we are now working on together with Indonesian and European companies, can at least be used to require Adidas to formally comment on the allegations." More information All the details of the case as well as the reactions of Adidas and Mizuno so far can be found here and here. The ILO's 2016 interim report, including recommendations to the Indonesian government, can be found here. contact: SOUTH WINDDr. Sabine FerenschildTel.: 0228-76369816E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.
