Apple Break Off Chinese Supplier for Using Underage Labor

Jan 25, 2013 06:28 AM EST

Apple terminates relationship with Chinese supplier for using underage labor. According to Apple’s Supplier Responsibility Report, which was released by the company Thursday, Guangdong Real Faith Pingzhou Electronics was employing workers under the age of 16.

“Our auditors were dismayed to discover 74 cases of workers under age 16 – a core violation of our Code of Conduct. As a result, we terminated our business relationship with PZ,” the company says in the report, according to ABC News.

Apple said in its 37 page report it also discovered one of the region’s labor agencies had conspired with the manufacturer, providing children to them and helping forge age-verification documents. It alerted the provincial government, which fined the agency and suspended its business license.

“The children were return to their families, and PZ was required to pay expenses to facilitate their successful return,” Apple says in the report.

While Apple has been the world's second-largest information technology companies by revenue after Samsung Electronics. It is the world's third-largest mobile phone maker after Samsung and Nokia. Fortune magazine named Apple the most admired company in the United States in 2008, and in the world from 2008 to 2012. However, the company has received criticism for its contractors' labor practices, and for Apple's own environmental and business practice.

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The average starting salary at Foxconn is around $285 a month or $1.78 an hour. Even with 80 hours of overtime it considered so low that the Chinese government does not deduct any payroll taxes. (Karson Yiu/ABC News)

Apple said in its report that it is fixing and tackling issues, such as excessive work hours and underage labor. In 2012, it became the first technology company to join the Fair Labor Association (FLA). At Apple’s request, the FLA launched an unprecedented audit on Apple’s largest final assembly supplier, Foxconn, China’s largest private employer, and the independent findings and progress reports can be found here

In 2010, 12 Foxconn employees plunged to their deaths one following the other. It was reported that the company’s CEO Terry Tai-Ming Guo invited pastors and doctors on mental welfare from Christian hospitals in Taiwan to counsel and share the gospel with the managers and company’s staffs at Longhua Science & Technology Park in Shenzhen.

Foxconn's Shenzhen factories alone employs 235, 000 workers - roughly the population of Orlando, Florida. (Karson Yiu/ABC News)

In March 2012, the Fair Labor Association released a report on the poor working conditions at Apple’s Foxconn supplier.

“After growing criticism during 2011 about the working conditions at Foxconn, including those conditions that led to deadly accidents, Apple agreed to allow FLA to conduct a thorough investigation of those suppliers, beginning with three factors at Guanlan, Longhua, and Chengdu in China,” says the FLA report. The month-long investigation revealed serious and pressing noncompliances with FLA’s workplace code of Conduct, as well as Chinese labor law.

FLA gave a long list of 280 recommendations to prevent future noncompliance with Chinese legal requirements and FLA’s Workplace Code, while bettering many aspects in workers’ lives. According to the report, Apple and Foxconn have agreed to ongoing assessments by FLA in order to ensure that labor practices meet FLA standards and remain in compliance for the long term.

An example of noncompliance was during peak production, the average number of hours worked per week at Foxconn factories in all three locations exceeded both the FLA Code standard and Chinese legal limits – some employees worked more than seven days in a row without the required minimum 24-hour break. “Foxconn has agrees to achieve full legal compliance regarding work hours by July 1, 2013, while protecting worker’s pay, according to the report. In addition, the Chinese supplier will need to increase employment to maintain current level of output, productivity and quality. In the next year, tens of thousands of extra workers will need to be recruited, trained and accommodated at the same time as hours worked are progressively reduced per worker.”

The average starting salary at Foxconn is around $285 a month or $1.78 an hour. Even with 80 hours of overtime it considered so low that the Chinese government does not deduct any payroll taxes. (Karson Yiu/ABC News)

ABC News visited the factory of Apple’s Foxconn supplier last year and wrote about his visit, “But while we looked hard to the kind of underage and maimed workers we’ve read so much, we mostly found people who face their days through soul-crushing boredom and deep fatigue.”

In 2010, 12 Foxconn employees plunged to their deaths one following the other. It was reported that Foxconn CEO Terry Tai-Ming Guo invited pastors and doctors on mental welfare from Christian hospitals in Taiwan to counsel and share the gospel with the managers and company’s staffs at Longhua Science & Technology Park in Shenzhen.

In August last year, FLA said that the Foxconn has completed 280 action items on time or ahead of schedule, according to ABC News. By July 1, 2013, Foxconn has promised to reduce workers' hours to 49 hours per week and stabilize pay - though the limit is rarely enforced because workers often want to work overtime and make ends meet.

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