What Apple’s Latest Supplier Audit Says About Apple

Apple’s annual supplier audit was released today and sure enough critics on both sides are already picking through the core and going at it over whether the company is doing enough to ensure the safety and compensation of the hundreds of thousands of workers who plug away in anonymity daily making Apple the wealthiest company ever.

Apple’s latest stats show a 92% compliance rate with its 60-hour workweek, and says the average workweek was less than 49 hours. Of course, that’s as it should be: Most of Apple’s supply chain is in China, whose laws cap the work week at 40 hours and monthly overtime at 36 hours. Adding nine hours per week over four weeks per month comes to 36, which means Apple suppliers are likely often breaking the local laws.

Indeed, that’s consistent with a separate study of nearly 100 Pegatron workers undertaken by labor rights group China Labor Watch, a constant thorn in Apple’s side, which found that more than half of the its workforce performs more than 90 hours of overtime per month, with some peaking at 132 hours.

Apple essentially ignores this by trying to turn a lemon into lemonade. It now touts its ban — as of October — on its suppliers’ charging workers to obtain jobs. As Apple senior vice president of operations Jeff Williams writes in the report, “You’ll see that we consistently report suppliers’ violations of our standards. … Because of these audits, over $3.96 million was repaid to foreign contract workers for excessive recruitment fees charged by labor brokers. And nearly $900,000 was paid to workers for unpaid overtime.” Williams says that this is proof that the system is working.

I don’t agree, but not because there are violations. I suspect any multibillion dollar company with operations (or contractors) in as many places that Apple has will encounter similar, if underreported, problems.

No, the reason I don’t agree is because the same subcontractors keep getting caught for the same violations. That shows a decided lack of regard for their major customer’s brand and mandates.

I think Apple is taking the problems seriously, but its supply chain is not. And the chain has no real incentive to change. As such, until Apple starts firing suppliers, the problems of what amounts to indentured servitude at its contractors’ factories will continue unabated.

This entry was posted in Hot Wires and tagged , , , , by Mike. Bookmark the permalink.

About Mike

Mike Buetow is editor-in-chief of Circuits Assembly magazine, the leading publication for electronics manufacturing, and PCD&F, the leading publication for printed circuit design and fabrication. He is also vice president and editorial director of UP Media Group, for which he oversees all editorial and production aspects. He has more than 20 years' experience in the electronics industry, including six years at IPC, an electronics trade association, at which he was a technical projects manager and communications director. He has also held editorial positions at SMT Magazine, community newspapers and in book publishing. He is a graduate of the University of Illinois. Follow Mike on Twitter: @mikebuetow