The Daily Tar Heel

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Thursday August 11th

Protests Over Labor Subside As Merchandise Money Rises

UNC affiliated with 2 monitoring groups

This relative silence is a far cry from various protests of recent years, many of which criticized the labor practices of manufacturing corporations that held contracts with UNC.

At the same time the University has increased its monitoring of corporations, it also has seen a substantial rise in the number of licensing contracts.

University officials attribute the success of licensing sales and the apparent lack of campus dissent to increased communication with major corporations, continued affiliation with labor monitoring groups and organized student and faculty input on licensing and labor decisions.

Looking at Labor

University officials say they have taken measures to ensure fair labor conditions in factories manufacturing UNC products.

The University's 12-member Licensing Labor Code Advisory Committee is composed of faculty, staff and students who advise Chancellor James Moeser on licensing and labor code policy.

Rut Tufts, director of trademarks and licensing, said the University implemented the committee in 1997 to ensure that licensed factories provided fair wages and conditions for laborers.

In addition, the University is a member of the Worker Rights Consortium and the Fair Labor Association, two organizations dedicated to ensuring fair working conditions.

Michael Beale, director of marketing for the Department of Athletics, said UNC supports both organizations because they work with corporations in different ways.

While the WRC performs detailed assessments of a small number of factories, the FLA requires about 2,000 factories to monitor themselves. External monitors then are sent to a small percentage of these work sites to conduct further investigations.

But some students have expressed their discontent with the joint membership, calling it redundant and pricey. The University paid a total of $82,000 in membership dues during the last fiscal year.

2001 graduate Dennis Markatos said UNC's joint membership exists mostly because of student initiatives during the late 1990s. Markatos, who co-founded Students United for a Responsible Global Environment in 1998, said he helped educate the University on labor issues through Students for Economic Justice, another organization focused on issues such as labor.

Markatos said SEJ led a three-day protest in South Building -- which houses UNC's administrative offices -- in April of 1999. Nearly 50 students refused to leave the building until then-interim Chancellor Bill McCoy signed their demand for public disclosure of factory locations, independent monitoring of conditions and living wages for workers.

Markatos said it was this active protest, combined with education about the issues, that led University officials to take action. He said student protests, however, should not be labeled as attacks on the University. "This wasn't an anti-University thing," he said. "We wanted to build a better University."

LLCAC Co-Chairman Jim Peacock also said continued violations of labor conditions cannot be ignored. The committee recently refused to renew a contract with New Era Cap Company, a sports apparel manufacturing corporation. The company's Derby, N.Y., factory prohibits employees from speaking about their jobs to outside parties.

Peacock also emphasized a commitment to educating students on labor issues and practices. In spring 1998, he, along with Nick Didow and Pete Andrews, developed a course in response to protests against poor factory conditions.

Peacock said Nike Corporation founder and CEO Phil Knight visited in April on the day students were presenting hypothetical reforms for the corporation. Knight later announced increased labor standards for contract manufacturers doing business with Nike at the National Press Club in Washington, D.C.

Knight invited several students in the seminar to the conference and credited the University for its student input.

But student disapproval with Nike emerged again in January 2001 when 800 workers at the Kukdong International plant in Puebla, Mexico, went on strike because of poor wages and conditions. At the time, UNC had a $7.1 million contract with Nike, and UNC sweatshirts were manufactured at the factory in question.

Although Moeser wrote a letter to Nike imploring the corporation to improve conditions, students launched protests near the Old Well and South Building.

Some made their statement by stripping off their factory-made clothing in the quad. Others draped the Old Well in chicken wire to represent the caged-in conditions of factories. One student even flew to Mexico to speak personally with factory representatives.

Peacock said that since the communication with Knight in 1998, more than 140 other universities have formed a relationship with major corporations regarding labor issues.

Merchandise Sales Still Soaring

Despite the University's commitment to labor standards, the sale of licensing contracts has risen over the last few years.

In the 2002 fiscal year, UNC made $4 million from merchandise royalties, Tufts said. This is a small percentage of the estimated $105 million retail value of UNC-licensed goods sold that year. Retail value is generally twice the price of wholesale value. The University receives 8 percent of the wholesale value, he said.

Tufts said the University has more than 500 licensees -- including corporations, companies and individuals -- who use the UNC logo or insignia for their products. The apparel industry is the largest and most profitable component of the mix.

To handle the large influx of requests, the University hired the Collegiate Licensing Committee to keep direct contact with licensees and to implement contracts. CLC is in constant communication with the University, he said.

Tufts attributes the success in sales to three main factors: sports, institutional loyalty and fashion. "In general, colleges and universities just have the first two factors. We have all three," Tufts said, adding that UNC apparel has launched a cultural phenomenon, whether it is worn by rappers or race car drivers.

Beale said the University has held one of the top sports licensing returns for more than five years. Although the athletic department does not approve licensing requests, he said, people have contacted the office to market everything from coffins to bobble-head dolls.

Beale said the University is careful not to oversell its insignia or to jeopardize its integrity through inappropriate merchandise. "People will put logos on anything these days," he said. "We're trying to keep it from getting too trashy."

He stressed the fact that 75 percent of the royalty money goes back to the University while 25 percent goes to the athletic department. "It's a great partnership and one that's been tremendously beneficial to the University from both an academic and an athletic standpoint."

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