November 13, 2008

Our September 2008 Update highlights recent comments by Adidas CEO Herbert Hainer which confirm that company's race to the bottom; Adidas is seeking to shift production to lower-wage countries like Laos, Cambodia and Vietnam. The real impacts of this race to the bottom are being felt by the workers around the globe who produce Mr. Hainer's products. Those impacts were best illustrated last May when former Salvadorian factory worker Sonia Lara Campos attacked Adidas' poverty wages in El Salvador at the company's annual general meeting.  Sonia asked the board "How long do the workers of Adidas have to wait until they receive a dignified salary?"

Sonia, who works for National Labor Committee (NLC) in Central America was invited by the Christliche Initiative Romero, a German labour rights group, to speak at Adidas' board meeting held in May in Furth, Germany.  At the meeting she made the following comments:

Good morning Mr. Hainer,

Good morning members of the Board of Directors and the Counsel of Administration,

My name is Sonia Lara, and I am from El Salvador. I speak for Accionistas Criticos. I am referring to items 3 and 4 on the agenda. I would like to talk about the wage that a worker earns at a factory producing for Adidas in El Salvador.

In your Code of Conduct you mention that the minimum wage that a worker earns, should cover at least the basic necessities. In El Salvador, the salary of a worker that produces for Adidas is $162 per month. According to the government’s official statistics the value of the basic food basket is $159, for an average of four people, and the extended market-basket is valued at $729. This means that the wage of a full-time worker for Adidas can cover the cost of the basic food basket only, and in order to cover the cost of an extended basket, at least 4 salaries would be needed.

The factories in El Salvador – including suppliers for Adidas – only pay the minimum wage. Production bonuses and other forms of adding to the salary have almost disappeared. In 2 factories producing for Adidas, the workers have indicated that the brands no longer want to pay more. Previously, they had a better salary.

That is why I want to ask you...

How is it possible that you pay less and less?

What measures will you take to improve the wages of the workers?

How long do the workers of Adidas have to wait until they receive a dignified salary?

Until these questions have been answered adequately, I cannot vote for the discharge of the Board of Directors and the Counsel of Administration.

Thank you for your attention.