Nike said Monday it acted after a six-month investigation of Saga Sports, which makes hand-stitched soccer balls in private homes. Nike said that violates company policy because of the potential for underaged workers and the inability to ensure safe working conditions.

"This contract factory has persistently broken its commitments and irrevocably breached its trust with us; most importantly, the factory has failed its employees," Nike chief executive and president Mark Parker said.

Nike said its investigation uncovered "serious allegations by trade union representatives and other Saga employees of worker harassment, wrongful termination and inaccurate payment of wages."

The company said the Fair Labor Association, in an unannounced audit of Saga unrelated to Nike's investigation, found similar violations. Nike said it held repeated meetings with Saga executives to correct the problems, but "Saga did not make needed changes."

The balls were made inside private homes in Sialkot, Pakistan, where Saga is based.