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December 9, 2020 06:52 pm

Apple Turned Blind Eye To Supplier Breaches of Chinese Labor Laws

Wayne Ma, reporting for The Information [Editor's note: the link may be paywalled; alternative source]: In 2014, Apple executives became alarmed when China enacted a new labor law meant to protect workers' rights. The law required that no more than 10% of a factory's workforce be temporary workers. Typically these employees have fewer benefits and legal protections than permanent ones, but Apple's suppliers increasingly relied on them in China's tightening labor market. Apple surveyed 362 of its supplier factories in China that year and discovered that nearly half were over the quota for temporary workers. Eighty factories used temporary workers for more than half their labor force, according to an internal Apple presentation reviewed by The Information. Apple asked its suppliers to come up with plans to reduce their use of temporary workers by a March 2016 deadline, when a two-year grace period for the law expired. However, by the time the law went into effect, little progress had been made. According to four former Apple employees familiar with its labor issues, Apple for years took no major action against its suppliers for violating the temp-worker labor law out of concerns it would create costs, drain resources and delay product launches. Three of the ex-Apple employees were members of its supplier responsibility team, which is in charge of monitoring violations and enforcing penalties, while the fourth was a senior manager familiar with its operations in China. The former employees, as well as a review of internal Apple presentations and the company's own data on factory hiring between 2013 and 2018, suggests that Apple's strategy for managing its supply chain made it difficult for its three biggest contract manufacturers -- Foxconn Technology, Quanta Computer and Pegatron -- to remain compliant with the labor restrictions. The issue surfaced again publicly last year when Apple admitted that Foxconn had broken the law at its massive iPhone factory in Zhengzhou, which can employ as many as 300,000 workers. Apple says it requires suppliers to abide by local laws and pledges to remove those that won't comply.

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