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Apple manufacturer accused of labor rights violations

China Labor Watch accused Pegatron, an Apple manufacturer, of labor rights violations

By Contributor / July 29, 2013

An Apple store in central Beijing, China. Taiwanese company Pegatrom, a major Apple manufacturer, has been accused of labor rights violations.

Alexander F. Yuan/ AP Photo/ File

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The Taiwanese company Pegatron Group, a major supplier to Apple, violated Chinese and international labor laws, as well as Apple’s social responsibility code, at factories in Shanghai and Suzhou, according to a report by human rights group China Labor Watch.

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CLW’s investigation found at least 86 labor rights violations, including 36 legal violations and 50 ethical violations.

“If you’re looking at it from a legal perspective, the Chinese government has to step in to enforce these laws, but if you’re looking at the business side, Apple is the one that needs to take responsibility for this,” says CLW executive director Li Qiang through an interpreter. China Labor Watch is a US-based labor-rights organization that was founded in 2000.

Pegatron gets Apple’s business by “squeezing its labor,” says Mr. Li. In order to offer Apple the lowest contract prices, Pegatron cuts its labor costs, but instead of reducing the number of workers, which would slow down the manufacturing output, Pegatron cuts the workers’ wages and living conditions.

This cost-cutting business model is by no means unique to Apple or Pegatron. Last year, CLW independently investigated Foxconn, another Taiwanese company, and the Korean tech giant Samsung for similar labor violations. A 2011 CLW labor report included the names of other big electronic companies such as Dell, Ericsson, HP, Nokia, and Microsoft.

In March 2013, three French labor rights groups filed suit against Samsung, alleging that it engaged in “deceptive trading practices.” Samsung had stated that the company complies with “all laws and ethical standards,” which human rights groups claimed were false based on a series of investigative reports by China Labor Watch.

CLW’s report compares the 17 social promises that Apple has made with "17 corresponding realities uncovered.”

For example, in May 2013, Apple reported that the company had achieved a 99-percent compliance with the company’s 60-hour workweek policy, according to CLW report. But, CLW discredits this achievement on two counts: Chinese law limits work weeks to 49 hours, which calls into question Apple's 60-hour goal. PLus, the investigation found that workers’ hours typically exceeded 60 hours.

An e-mail response from Apple challenged this assessment of Pegatron facilities, stating that the company's most recent survey in June “found that Pegatron employees making Apple products worked 46 hours per week on average.” 

“If [Apple] doesn’t do something to improve things, and meet their own standards, then they are really using false advertising,” says Li.

CLW says that it's been in touch with Apple to discuss how the company should address labor violations among its manufacturers.

“We will investigate these new claims thoroughly, ensure that corrective actions are taken where needed and report any violations of our code of conduct,” says Apple in its statement.

"This entire business model of first giving the orders, and then following up and trying to improve labor conditions is wrong and backwards,” says Li. Instead, companies should conduct better preliminary investigations of overseas manufacturers to raise the bar for labor standards, he says.

The factories investigated by CLW included Pegatron Shanghai, which, according to CLW, assembles iPhones; Riteng, a Pentagron subsidiary in Shanghai that produces Apple computers; and AVY, a Pentagon subsidiary in Suzhou that makes iPad parts. 

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