Apple Jumps to Respond to Latest Asian Labor Allegations

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Philippe Lopez, AFP, Getty Images
Apple (AAPL) is pledging action after once again coming under fire for its suppliers' labor practices in Asia.

On Monday, the New York-based nonprofit China Labor Watch released a report slamming Apple for labor violations at three Shanghai factories run by Pegatron, a Taiwanese company. The report describes a litany of labor abuses, some of which violate both Chinese law and Apple's own Supplier Code of Conduct. The report describes 11-hour shifts at below-average wages, insufficient shower facilities, involuntary overtime and substandard food, among other complaints. It also reveals discriminatory hiring practices, including the exclusion of certain ethnic minorities and people over the age of 35. And it alleges that recruitment agencies used by Pegatron charged unlawful hiring fees and held onto workers' IDs for as long as two weeks, preventing them from resigning and seeking new work.

The report was researched by undercover investigators, who conducted interviews with workers from March to June. It says that the workers at Pegatron's facilities were assembling Apple's new, cheaper iPhone 5C, which has not been formally confirmed by Apple but has been the subject of rumors for some time.

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Apple has been stung by bad PR stemming from labor problems at its numerous Asian contractors, including worker suicides and underaged workers at Foxconn, a major partner in China. So it was quick to respond to these latest allegations.

In a statement, Apple said that it had conducted 18 audits of Pegatron facilities over the last six years, and that its previous audits had shown an average work week of 46 hours -- a far cry from the 66-hour work weeks alleged by China Labor Watch's investigation. It also said that it had put a stop to the company holding onto workers' IDs almost as soon as it became aware of the practice.

Still, Apple says that it was unaware of much of the information contained in the report, and it pledged to take steps to address the issues. It says that it will send auditors to the Pegatron factories in question this week, and that it will address any violations of its Code of Conduct and see to it that workers are compensated any unpaid wages.

It's no surprise that Apple is responding so quickly and decisively Monday morning. Conditions at the Foxconn plants have been an ongoing PR nightmare for Apple, and the last thing the company wants is another round of Asian labor headaches.

Matt Brownell is the consumer and retail reporter for DailyFinance. You can reach him at, and follow him on Twitter at @Brownellorama.
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