And then there were two.
Absent “significant progress” toward the resolution of an ongoing labor dispute in Honduras, Cornell University will follow the University of Wisconsin at Madison's lead  and end its licensing agreement with Nike. The decision, issued by President David Skorton in an internal letter  Monday, is being heralded by anti-sweatshop activists as a significant victory in a battle over Nike’s refusal to pay severance to displaced workers in its supply chain.
“I have made the decision to allow the licensing agreement to run through its expiration date of December 31, 2010, at which point I will allow our agreement to expire unless significant progress is made,” Skorton wrote the university’s Licensing Oversight Committee, which recommended the contract be severed. “I am doing this to allow Nike time to accelerate discussions I understand are underway between the company and union representatives acting on behalf of the displaced workers and to become more assertive in its efforts to remediate the Codes of Conduct violations.”
As the second institution – and the only Ivy League university – to take a stand on the labor issue, Cornell's move is sure to escalate pressure on a company that has been increasingly under fire since the closures of two Honduran factories 16 months ago. At issue is an estimated $2 million in legally mandated severance owed to workers at two Nike supplier factories, Hugger de Honduras and Vision Tex, in Honduras.
While Nike has offered training and vocational programs, the company insists the payments are the responsibility of the subcontractors. That position, however, runs afoul of many university codes of conduct – including Cornell’s, which holds licensees responsible for the actions of subcontractors, the university’s oversight committee maintains.
In response to Cornell’s decision, Nike issued a statement suggesting the company is working to resolve the issue.
“Nike is very concerned for the affected workers of Vision Tex and Hugger and continues discussions with key stakeholders on this matter,” the statement reads. “In addition, we are in direct discussions with Cornell on our ongoing efforts in support of the workers in Honduras.”
Jack Mahoney, national organizer for United Students Against Sweatshops, said the Cornell decision was the product of an intense campaign on the campus, including a visit by displaced Honduran workers who shared their stories with administrators, faculty and students.
“I think this latest step by Cornell in conjunction with what happened at Wisconsin clearly is going to matter and give Nike some incentive to resolve this issue,” Mahoney said.
Moreover, past campaigns – such as one against Russell Athletic – have shown that once a few universities take a stand, others often follow.
“We’re going to have now both Wisconsin – a large important public school – and Cornell – an important Ivy – both setting a tone,” Mahoney said. “I think that really helps us on other campuses where students are having these conversations with administrators and want to point to the way that other universities are taking the lead on this.”
Conversations about pulling out of Nike contracts are already occurring on many other campuses. The University of Washington’s Advisory Committee on Trademarks and Licensing, for instance, has recommended Washington sever its contract  if Nike doesn’t resolve the labor dispute. No decision on the contract has been made, however, a university spokesman said Thursday.
In addition to potentially pressuring other universities to follow its lead, Cornell is calling on the Collegiate Licensing Company – an agent that assists many universities with Nike contract negotiations – to urge Nike to resolve the labor dispute.
While Cornell’s licensing agreement with Nike would end Dec. 31 absent satisfactory progress from the company, the expiration would not impact an additional agreement the university has with the company for providing athletic apparel to sports teams, a university spokesman said Thursday.
Casey Sweeney, president of the Cornell Organization for Labor Action, said she believed the broad student support for pressuring Nike helped inform Skorton’s ultimate decision. More than 30 organizations endorsed the campaign, including the Student-Athlete Advisory Council, which has representatives from all of the university’s 36 team sports.
“I think it just is a testament to the wide range of support we were able to gather,” Sweeney said. “It was really nice to see in our community there are certain values we uphold across the community. For [the Student-Athlete Advisory Council] to feel as passionate about it as we were, was exciting.”