Nike Indonesia stumps up $1m for unpaid overtime

Nike has agreed to pay USD1 million to about 4,500 workers at a PT Nikomas plant in Indonesia as compensation in a dispute over unpaid overtime. The workers' union claimed that 593,468 hours of overtime went unpaid over the last two years.

"This has the potential to send shock waves through the Indonesian labour movement," said Bambang Wirahyoso, the national chairman of the Serikat Pekerja National (SPN) trade union. "The leadership at SPN is gearing up to take on the fight for any workers who have been subjected to forced overtime without pay. We have only just begun."

Unions have said they are planning to take action against other multinational firms such as Adidas and Puma.

The settlement comes after 11 months of negotiations. Nike says it will offer training programs, and set up a task force to address grievances but the issue is likely to remain a contentious one between the two parties. SPN said that while it was pleased with the result, the workers were owed much more.

"The practise of forcing workers to do overtime without pay was actually happening for 18 years at Nikomas, but Indonesian law only allows redress for the past two years," SPN said in a statement.