Group Finds 'Significant Issues' At Foxconn Factories

The Fair Labor Association has released its audit of Apple's largest supplier in China, Foxconn. The group found "significant issues with working conditions" at three factories there. The labor rights group, which was asked by Apple to audit the plants, found excessive overtime, problems with overtime compensation, health and safety issues as well as communication gaps that have led to widespread sense of unsafe working conditions. Melissa Block talks with NPR's Steve Henn.

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ROBERT SIEGEL, HOST:

From NPR News, this is All Things Considered. I'm Robert Siegel.

MELISSA BLOCK, HOST:

And I'm Melissa Block.

The Fair Labor Association, a labor rights group, has released its audit of Apple's largest supplier in China, Foxconn. The group found what it calls significant issues with working conditions at three factories there, including more than 50 violations of the FLA's code of conduct and Chinese labor law.

NPR's Steve Henn joins me now to talk about that and the company's response. And, Steve, Foxconn makes a number of Apple's popular devices - the iPhone, the iPad - what kind of problems did this labor rights group find there?

STEVE HENN, BYLINE: Well, the most common issue was that workers at these plants were routinely asked to work more than 60 hours a week. During peak production times, the average worker at the plants was putting in what the FLA called excessive overtime. These plants violated the Fair Labor Association's own guidelines for overtime. And in many cases, they were also violating Chinese labor laws.

The Fair Labor Association also found fairly wide spread examples of workers who were not being paid in full for the overtime that they actually put in. They also found health and safety violations, as well as communication gaps between management and workers that led to a pretty widespread sense of unsafe working conditions.

BLOCK: So, how has Apple responded to this report?

HENN: Well, Apple asked for this report. The joined the Fair Labor Association and asked the FLA to audit these plants. And they said that they will work with Foxconn and the Fair Labor Association to address the problems that the FLA found.

And in some cases, they were already trying to address these issues before the report was issued. You know, Apple has said for a while that now that it wants its supply chain to be a model in the industry. So, even before the report was made public, the company was taking steps to try and get in front of this, blunt the public relations damage.

Tim Cook is in China this week, touring Foxconn plants there and meeting with executives. And the company began several months ago publishing overtime statistics for half a million employees that work at these plants. So, in January, it said that 84 percent of its suppliers could abide by overtime rules in China.

In February, in the ramp up to the release of the new iPad, they said that their suppliers were doing even better and that 89 percent of the suppliers complied with overtime rules.

BLOCK: Well, what did the Chinese workers at this Foxconn plant tell the auditors from this labor rights group about the overtime that they were working?

HENN: Well, that's one of the interesting things. Close to two-thirds of the workers interviewed at these plants - and Foxconn interviewed - the Fair Labor Association interviewed 35,000 workers there. But two-thirds of them said their salary wasn't sufficient to meet their basic needs.

Auret van Heerden, the president of the Fair Labor Association, told me that many of these workers, roughly a third of them, actually wanted more overtime.

AURET VAN HEERDEN: That's true. And we find that in a lot of developing countries where you have young workers who've gone up to work in these factories and they've gone there with the purpose of making as much money as quickly as possible.

HENN: So, what that means is to address the overtime problem, Foxconn will have to both cut hours and raise wages at its plant. And when you're talking bout cutting the hours of hundreds of thousand of employees, it becomes this incredibly enormous undertaking. Foxconn will need to hire tens of thousands of new employees. It will probably need to build new dormitories and cafeterias. But still, Foxconn has pledged that by July of 2013, it will abide by Chinese labor laws and cut overtime at all its Apple plants.

And van Heerden says he hopes that that could put pressure on other employers in the electronics manufacturing industry to raise wages and cut hours as well.

BLOCK: OK. NPR's Steve Henn, thanks so much.

HENN: Thanks, Melissa.

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