Employee view and personnel of Nike Company - Essay Example

Nike, based in Oregon has more than 22,000 employees and over 800 contract suppliers in more than 52 countries across the world. While it always endeavored to deliver high-quality goods at affordable costs, it came under heavy criticism over working conditions and employee wages in Asia. Physical and verbal abuse of workers, hazardous working condition, extremely low wages and anti-union efforts throughout Indonesia, China and Vietnam were reported (O’Rourke, 1997). Nike violated laws about working conditions, working hours, and forced overtime. When workers gained the right tom organize in South Korea and Taiwan, it shifted its operation to Indonesia. When it first started operations in Vietnam, the wages that they paid was low even by Vietnamese standards. In response to workers abusing, Nike shirked responsibility saying that workers and the working conditions was not their responsibility. They have been labeled as employing ‘sweatshop’ conditions in their manufacturing units. The employees are far from satisfied because of the unethical labor practices that it employs. After being publicly abused, the company has taken initiatives to bring changes in its manufacturing workplace conditions. They even decided to stop employing child labor. Most of their factories are in third world countries so that they can avoid the US law and the onus lies on the country of production. The meager wages that they pay has caused deep seeded cynicism amongst the workers. Environment of exploitation continues to prevail. High target demands lead to overtime and workers become physically worn out. Their eyes start to fail, and other physical problems arise due to long hours of work (Amey et al., n.d.). In Indonesia, 73.4% of workers are satisfied with their relationship with direct line supervisors, 67.8% are satisfied with management. The main concern was related to their physical working environment (Mallen, 2006). Employee turnover has been very high due to lack of training and development. The Worker Enrichment Project has helped to reduce staff turnover. It provides educational opportunities to develop skills in computers, basic English language, bookkeeping and supervisory skills (Murphy & Matthew, 2001). Nike has also started health management and safety audit program. They have also started onsite education program for the workers so that they have continued learning. Nike is not the ‘beast’ that it is projected as, because similar situations exist in other footwear and garment units. They have a system of rewarding their regular employees. After experimenting with cash and travel vouchers, Nike feels employees should be able to target the rewards that appeal to them (Lynne, 1997). Hence it now offers Virgin vouchers which include range of activities from flights to luxurious holidays and participants can focus on awards that appeal to their own aspirations. Nike offers its employees five weeks off with full salary and benefits to spend the way they want (Browning, 2003). This helps the employees to spend time with their families or rethink career goals. Though this program was started in 1994, Nike is not sure how many employees have used it. In US Nike workers are given incentives such as Nike Bucks (vouchers worth $1 of Nike goods and services) if they will walk, run, bike, skate or car pool to work while no such incentives are available in Asia (Boje, 1998). Workers in Oregon work in campus like facility, receive top benefits and time off for recreation and sports (Boje, 2001). They have employed about a thousand expatriates who travel the globe to ensure that code of conduct and other norms are adhered to at each of their manufacturing units. There are about 600,000 subcontract workers, mostly women between 16 and 22, who provide the resistance to Nike corporate power and subcontractor practices. Nike considers its applicants as both customers and employees. It is able to attract the best and brightest employees. It uses computer assisted interviewing after which there is a personal interview. For a store in Las Vegas it had 6000 applicants to fill 250 positions. Nike used the IVR technology to screen out people. When recruiting new candidates, the company gives importance to those who have been in customer service environments, have a passion for sports and would make good Nike customer service representatives (Linda, 1998). It has now streamlined its recruitment process thereby also reducing the cost per hire. External applicants can apply through the internet website (Pollitt, 2005). Electronic links have also been established with external web-based recruitment organizations like Monsterboard to provide job posting opportunities to attract candidates. They also stick to the conventional methods like advertising through the newspapers, and headhunting organizations for the senior positions. Existing employees can also apply for the various jobs posted on the internet. Due to advanced technology, hard copy resumes have disappeared and the managers can see the resumes of the short-listed candidates. Every six months the registered applicants are automatically asked to update their CVs so that it remains active on the system. Managers can now access the current job opening status from their desktops. As far as promotions are concerned, Nike has brought about new strategies for Vietnam. Personal and professional development including promotions within Vietnam was not prevalent. Career advancement demanded continued education. Nike disengaged from the contractor employee relationship and introduced promotion practices from the United States (Arnold & Hartman, 2003). They have now established local education facilities near the factories and currently fund 50% of the cost of after-hours education programs for each supplier. Nike has been able to effectively rebuild and redefine relationships with the contractors to assist them in meeting the codes of conduct. The management at Nike and more specifically the founder knows how to keep its people motivated. He wants employees to feel pride in their organization. He has an unconventional leadership style. Ever since the scandal in 1997, key personnel at all suppliers and factories across nations are trained in the Code of Conduct. As far as the wages and benefits are concerned, Nike claims now at least the minimum wage required by the local law or the prevailing industry wage, whichever is higher is being paid. In addition to the compensation for the regular hours of work, employees also receive compensation for overtime as per the norms of the local law. In human terms the employees have to work excessive overtime to meet their own needs and save money. Workers are under constant pressure to reach the quota (Connor, 2001). Despite certain changes and amendments, Nike has not been strictly adhering to applying the code of conduct in all countries. Even China is dissatisfied and Nike officials shift the responsibility to the Chinese government (Boje, 2001). The trade union is mostly composed of the management leaving no scope of bargaining from the workers. Workers in many cases are not even aware that there is a trade union in the factory. Those that are aware of the union believe that the function of the trade union is to organize picnics, singing contests and birthday parties. They never stand the labor disputes or stand with the workers. Nike seems to have a different set of rules and benefits for its employees in US and in the developing countries. The employees in US receive benefits and compensation enough to derive satisfaction but those in developing nations work under sub-standard conditions and receive inadequate wage. While the recruitment process is streamlined, it is only for the managerial positions globally and not for the factories. Nike needs to pay a living wage to attain higher profits and to sustain its global economic power. References: Arnold, D. G. & Hartman, L. P. (2003), Moral Imagination and the Future of Sweatshops, Business & Society Review, Vol. 108 No. 4 pp. 425-461 Amey et al., (n.d.), Nike: Leading the corporate responsibility movement? 08 Oct 2006 Boje, D. M. (1998), Nike, Greek goddess of victory or cruelty? Women’s stories of Asian factory life, 08 Oct 2006 Boje, D. M. (2001), Nike, Nietzschean Superman and the Sweat Life for Superwomen, 09 Oct 2006 Connor, T. (2001), Still Waiting For Nike To Do It, 09 Oct 2006 Linda, T. "Computer-assisted interviewing shortens hiring cycle." HRMagazine 43.n2 (Feb 1998): 73(6). British Council Journals Database. Thomson Gale. 8 Oct. 2006 Lynne, C. "24-carat carrots. (non-cash incentives)(includes related article on Bull Information Systems employee incentives)." People Management 3.n9 (May 1, 1997): 37(2). British Council Journals Database. Thomson Gale. 8 Oct. 2006 Mallen, B. (2006), Corporate Social Responsibility - Companies in the News - Nike, 09 Oct 2006 Murphy, D. F. & Matthew, D. (2001), Nike and Global Labour Practices, 07 Oct 2006 ORourke, D. (1997), A Critique of Nikes Labor and Environmental Auditing in Vietnam as performed by Ernst & Young, 08 Oct 2006 Pollitt, D. (2005), E-recruitment gets the Nike tick of approval, Human Resource Management International Digest, Vol. 13 No. 2 pp. 33-35 Read More