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 ADVISORY

Not for publication

March 31, 2000 – No. 195

Note: McCoy’s letter is available from News Services, (919) 962-2091.

McCoy accepts advisory panel’s advice to join WRC conditionally, stay in FLA

The University of North Carolina at Chapel Hill will follow its Licensing Labor Code Advisory Committee’s recommendation to join a new labor monitoring organization on a conditional basis and remain in another group, Interim Chancellor William O. McCoy said today (March 31).

At McCoy’s request, the advisory panel -- represented by students, faculty and staff -- this spring has deliberated over whether UNC-CH should remain affiliated with the Fair Labor Association (FLA) or join a new group, the Worker Rights Consortium (WRC).

FLA is a White House-sponsored non-profit organization made up of corporations, non-government organizations and more than 130 colleges and universities. WRC, which will hold its founding conference in New York City on April 7, has an estimated 18 to 20 campus members and is proposed by a coalition of student and worker-rights organizations.

Last week, the committee unanimously recommended that UNC-CH continue its membership in FLA, with annual review, and join the WRC on the same conditional basis stipulated recently by three other large public universities -- Indiana, Michigan and Wisconsin. (To see the report, go to http://www.unc.edu/news/labor.pdf.).

McCoy informed the committee of his decision in a letter today (March 31) to co-chairs Rutledge Tufts, director of auxiliary services, and Dr. Richard (Pete) Andrews, faculty chair. In the letter, McCoy said he had studied the committee’s report and discussed the issues with UNC-CH community members, particularly students and faculty, as well as people off campus. Those efforts led to McCoy’s conclusion to accept the panel’s basic recommendation regarding continued membership in FLA and joining WRC.

"The work FLA has done is solid, and it reflects strong university involvement," McCoy’s letter said. "The WRC is only beginning to form, and has a number of elements – identified in the committee’s report – which are problematic, but I am willing to join on a provisional basis pending a final decision at some point in the future regarding whether to commit fully to its organization and procedures."

McCoy said in the letter that UNC-CH would continue in FLA for at least another year and join WRC in

its initial meeting as well as in subsequent efforts to create a responsive governance and operational structure. "Our participation in WRC over the next several months will be subject to periodic review to determine how effectively WRC is meeting this university’s interests," he wrote. McCoy said he would ask the committee to offer further assessments of the WRC’s potential to help the university achieve its goal of improving working conditions in factories that produce UNC-CH-licensed goods.

Both steps are subject to conditions based on the panel’s recommendations. They are that UNC-CH:

· Will not impose the proposed requirements of either FLA or WRC membership on licensees (such as membership dues in FLA or disclosure requirements in WRC) until it has reviewed the results of the initial participation period and reached its own decision about the viability of the processes that are developed.

· Expects to retain the right of final decision in writing on monitors to be used at its licensees’ facilities.

· Will be limited in its financial exposure in either case to its currently defined membership dues.

· Participation at this point does not represent agreement with future positions of the organizations, such as certification for FLA member companies or a defined "living wage" for WRC.

· Participation in each group does represent a commitment to work within each, in cooperation with other campuses, to achieve common goals of good labor practices in collegiate licensing manufacturing facilities and to achieve the refinements in each organization that are desirable from UNC-CH’s perspective.

Besides those conditions outlined by the committee, McCoy’s letter added two other stipulations:

"The FLA must continue its development of a strong monitoring program, including accreditation of objective, competent monitors who have the ability to arrive at independent, accurate assessments of code compliance, and must continue elaboration of a program that will enhance the implementation and verification of labor standards for all of our licensees." McCoy will ask the committee to advise him periodically on such progress over the next several months.

"The WRC must develop in a responsible manner consistent with the best long-term interests of the university, including our ability to work with its licensees over time. Most specifically, if UNC-CH and other major universities are to continue to participate in the WRC, it will be essential that it develop a governance structure that is accountable to the universities that are being asked to finance it. It will also be essential that it develop as an organization in which universities can engage with all other legitimate parties to achieve their goals, including licensees as well as labor and human rights organizations. Finally, it is essential that it demonstrate the capacity to provide monitoring and investigative services that are respected by all parties as independent, objective and competent on a financially viable and continuing basis."

UNC-CH’s stature on the national scene regarding labor code issues is important, McCoy said. "This university has built one of the nation’s premier trademark licensing programs," he said. "Besides protecting the university’s good name, the majority of that program’s revenues benefit some of our neediest students. … Our own students, faculty and administrators all have consistently played key roles in the conversations that have been making a difference on other campuses, in board rooms and with our licensees. We should not lose sight of the progress that has been made at the university and elsewhere in the past year regarding important issues like public disclosure of production sites."

"Ultimately, the university community and the public need to know that Carolina remains committed to ensuring that products bearing our name and logo are manufactured under fair working conditions," the

letter concluded. "That has been the goal of all -- students, faculty and administrators -- who have worked so long and hard on these issues. We will go forward and continue to make progress in a spirit of compromise and consensus."

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UNC-CH ranks among the leading universities worldwide in sales of products bearing its name. Sales of UNC-CH goods totaled about $80 million in 1998-99. UNC-CH received $2.874 million on royalties from such sales in the fiscal year ending June 30, 1999. Seventy-five percent of those funds go to scholarships and financial aid; the rest go to the athletics department.

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Web links:

Fair Labor Association, www.fairlabor.org

Worker Rights Consortium, http://www.workersrights.org

Sources: To reach McCoy, call Mike McFarland, News Services, (919) 962-8593. On the licensing panel, call co-chairs Tufts, a member of the executive committee of the University Advisory Council, comprised of FLA member campuses, 962-2403, or Andrews, UNC-CH faculty chair, at 966-2359 or 962-1671.