Case Brief: Avery Dennison (Honduras)

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To:WRC Affiliate Universities and Colleges
From:Tara Mathur and Ben Hensler
Date:Match 22, 2021
Re:Case Brief: Avery Dennison (Honduras)

This brief concerns the successful securing of offers of reemployment and compensation, in December 2020, for 33 workers whom the WRC found had been dismissed in violation of their legal rights, by Avery Dennison (Honduras), a factory in that country that supplies university licensees. Workers at this factory, which is a subsidiary of the US-based Avery Dennison Corporation, produce printed and embroidered labels that the company supplies to many international apparel brands, among them adidas, Champion (Hanes), Fanatics, Nike, and Russell (Fruit of the Loom), all of which source university-licensed goods from Honduras.

Like most factories in the country’s garment industry, Avery Dennison (Honduras)’s business was negatively affected by the economic crisis precipitated by the Covid-19 pandemic, as a result of reductions in orders from many of its key customers, which include, in addition to the brands listed above, Gap, Guess, Levi’s, Puma, PVH, Under Armour, VF, and Walmart. In June 2020, Avery Dennison conducted an economic layoff in which it dismissed 100 of the factory’s workers, of whom 33 were members of a union that represents workers at the factory.

In response to a complaint received from the workers’ union, the WRC investigated the company’s process for selecting workers for dismissal. The WRC’s investigation involved extensive interviews with not only affected workers, union leaders, and Avery Dennison corporate representatives but also independent legal experts and officials from the Honduran Ministry of Labor.

The WRC determined that, while the layoff did not appear to target union members specifically, the company’s selection of workers for dismissal did not comply with Honduran labor laws—which require that employees who are union members be protected in the case of a layoff, relative to the general workforce, in order to ensure that such discriminatory targeting does not take place. Accordingly, the WRC recommended that these employees be reinstated to their jobs with compensation.

While Avery Dennison disputed that the dismissals violated Honduran law, in December 2020 the company agreed to offer rehiring to all 33 of the employees affected by the June 2020 layoff who were union members, along with a payment to the workers that totaled roughly $18,000. This commitment was memorialized in a signed settlement between the union and the company. The WRC subsequently confirmed that both the offers of reemployment and the compensation were provided to the workers as the company had agreed.

Over the past 12 months, workers throughout the global garment industry have experienced massive job losses and widespread violations of their legal rights. In this difficult environment, the restoration of workers’ employment at Avery Dennison and the enforcement of their legal rights underlines the importance of both workers’ ability to bring complaints when these rights are violated, through their labor representatives, and of independent factory monitoring to ensure that these violations are remedied.

As always, please let us know if you have any questions or concerns.