- Updated March 29, 2012, 8:41 p.m. ET
Audit Faults Apple Supplier
Outside Audit Finds Health, Safety Violations at Foxconn
A top Apple Inc. supplier agreed to change its labor practices after an outside audit of its Chinese factories found widespread breaches of work rules, including 60-hour work weeks and other health and safety violations.
Foxconn Investigation Report Highlights
The investigation of manufacturer Hon Hai Precision Industry Co., known as Foxconn, was conducted by the Fair Labor Association and is the latest to document workers-rights violations in Apple’s supply chain.
The audit was based, in part, on surveys of 35,500 workers building products like iPods, iPads and iPhones at three Foxconn facilities in Shenzhen and Chengdu. Apple, whose own audits have found similar violations, requested the investigation.
The nonprofit labor group found at least 50 legal or code violations or policy gaps, according to its report. The findings prompted Foxconn and Apple to agree to new reforms.
FLA found that during some periods over the past 12 months, workers at all three facilities worked an average of more than 60 hours per week, exceeding the FLA code and Apple’s own standard. The audits found there were several months in the past year in which the majority of workers exceeded China’s legal maximum of 36 overtime hours a month.
The association said Foxconn agreed to bring its factories within China’s legal limits of 40 hours of work per week and 36 hours maximum overtime per month by July 2013. That would require more than halving the average hours of overtime, which the report pegged at 80 hours a month. FLA said Foxconn would need to recruit tens of thousands of extra workers to comply.
The probe is one of the most detailed labor investigations of a Chinese manufacturer to date and the first major outside audit of Apple’s supply chain.
In a statement, Apple said it fully supported FLA’s recommendations.
“We think empowering workers and helping them understand their rights is essential,” it said, adding the Cupertino, Calif., company had been working on these issues for years.
Foxconn said it would work with Apple to remedy the issues and has participated “fully and openly in this review. It added “our employees are our greatest asset and we are fully committed to ensuring that they have a safe, satisfactory and healthy working environment,” it said.
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Apple CEO Tim Cook, in yellow, visiting a Foxconn plant Wednesday.
In an interview, FLA President and Chief Executive Auret van Heerden said Foxconn’s commitment to reduce overtime hours was a model for the industry and would prove to others it can be done.
He added that the findings were “no worse than any other factory in China.”
FLA conducted the investigation for three weeks starting in mid-February. It found an array of health and safety issues at the Foxconn facilities such as inadequate risk analysis and missing systems for protecting workers from excessive heat.
More than 43% of workers reported they had experienced or witnessed an accident. “A considerable number of workers felt generally insecure regarding their health and safety,” read the report.
FLA also found that workers weren’t being fairly compensated for overtime, something FLA said Foxconn and Apple also committed to fix.
Through the surveys—which were conducted on iPads and computers—the association found workers were roughly two-thirds male with an average age of 23.
Assessing worker sentiment, the report said 48% of respondents thought working hours were reasonable, while 17.7% thought they worked too much. Some 33.8% wanted to work more to earn more, while 64.3% of workers thought their salary wasn’t sufficient for basic needs.
FLA has 34 members, including apparel companies with Chinese operations, like Nike Inc. Mr. van Heerden said this survey was the most detailed the association had ever conducted in China. He said the group would continue to monitor Foxconn’s progress and update its findings regularly.
The report card spotlights the same workers-rights criticisms that Apple has been combating more aggressively in recent months. Recently, the technology giant’s own annual audits have found instances of underage labor, excessive working hours and inadequate safety.
In January, Apple released a report saying that last year only 38% of its suppliers met its standard for a maximum 60-hour work week and at least one day off every seven.
More recently, it said that 89% of 500,000 workers it surveyed throughout its supply chain in February met its working hours standard.
Apple Chief Executive Tim Cook has said the company is committed to improvements and has begun to monitor conditions, particularly working hours, in more detail. This week, as he was in China visiting high-level government officials, Mr. Cook also toured an iPhone assembly line at a Foxconn facility in Zhengzhou.
Mr. van Heerden said the FLA’s investigation was more “bottoms up” than Apple’s own audits, which are designed to assess compliance with particular codes.
Write to Jessica E. Vascellaro at email@example.com
A version of this article appeared Mar. 30, 2012, on page B1 in some U.S. editions of The Wall Street Journal, with the headline: Audit Faults Apple Supplier.