Apple?s Reputation Threatened for the Law
Apple?s Reputation Threatened for the Law
July 14 (Bloomberg) — Jiang Bo says he drove a cement truck for China’s Shenzhen Antuoshan Investment & Development Co. 12 hours every day for seven years without overtime pay.
A national labor contract law implemented Jan. 1, 2008, was supposed to limit work hours and ensure severance pay. A week later, the concrete company asked Jiang to sign a contract setting his base salary at 810 yuan (9) a month, 45 percent less than he usually earned, to avoid additional overtime costs, he says. Jiang refused and was let go without compensation.
Employers ignoring a law designed to mute labor discontent prompted Chinese workers to file double the number of claims last year with courts and arbiters, the government says. The trend leaves international manufacturers open to potential consumer backlash that may stem from any abuses. U.S. companies such as Wal-Mart Stores Inc. and Nike Inc., main Chinese manufacturer of shoes, said they’re training Chinese suppliers on the rules and inspecting them for compliance.
Beaverton, Oregon-based Nike held workshops with contract factories after the law took effect to ensure they understood its ramifications and Nike’s expectations, said Kate Meyers, a spokeswoman for the sportswear company.
Apple Suppliers
Apple Inc., which relies on Chinese manufacturers for its iPhones and iPod music players, found 45 of the 83 factories it audited last year didn’t pay proper overtime and 23 provided less than minimum wage, according to its 2009 progress report on supplier responsibility. The Cupertino, California-based company required them to adjust practices to ensure correct payments, it said in the report.
Apple has been auditing how its Chinese suppliers treat their workforce since 2006, spokesman Steve Dowling said. The number of units audited more than doubled last year from 39, and the company trained more than 400 of its employees to monitor compliance with its factory standards, according to the report. Apple also instructed more than 27,000 Chinese supplier employees and managers on worker rights and social responsibilities, the report found.
Little Incentive
The Electronic Industry Citizenship Coalition, whose members include several Meitai contractors, said in an April 3 statement that corrective actions were to be taken. The plant is making improvements, Meitai spokeswoman Catherine Lien said.
Meitai is not a direct Chinese supplier for Round Rock, Texas-based Dell or Palo Alto, California-based Hewlett-Packard, spokeswomen for each company said. Both companies asked their direct Chinese suppliers to do an investigation and changes are being implemented, they said.
Chinese suppliers have little incentive to abide by the rules, said Bama Athreya, executive director of the International Labor Rights Fund in Washington.
Worker rights abuses have long been an issue for U.S. and European companies that turn to developing nations for cheap labor, slashing prices for consumers. They have attempted to protect themselves by setting codes of conduct for Chinese suppliers and instituting audits to measure compliance.
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