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Another Well Timed Report of Alleged Labor Rights Abuses Regarding an Apple Supplier

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As the world awaits Apple’s long awaited announcement this week’s on new models of iPhones, another report of potential labor rights violations associated with this phone’s production ramp-up has surfaced.

On Thursday, labor rights watchdog group China Labor Watch cast another light on the potential existence of labor rights violations at the contract manufacturing production facility operated by Jabil Circuit in Wuxi China.  The labor rights organization conducted an undercover investigation that resulted in alleged infringements involving millions of dollars in unpaid overtime wages, over 100 hours of monthly mandatory overtime, more than 11 hours of standing work with little rest outside of 30 minute meal breaks, along with hiring discrimination and lack of worker pre-training.

A posting on Huffington Post Business reports echoes the China Labor Watch report and points to workers having little time to eat during meal breaks, having to travel to a distant factory cafeteria after being required to pass through mandatory security checkpoints. Workers are also alleged to be sleeping in 8 person dorms where workers assigned to day or night shifts are sharing the same dorm room.

For its part, Apple informed Huffington that it had conducted three audits of Jabil Wuxi over the past three years with some findings, and that Jabil has “an excellent track record of meeting Apple’s high standards.” At publishing, Huffington was unable to secure a comment from Jabil management.

Reviewing the Jabil web site, one can find a rather definite declaration of business conduct, signed by the firm’s CEO, that addresses supply chain transparency, health and safety and other business requirements supported by audit processes. Thus both Apple and Jabil do indeed publish high standards related to social responsibility and worker labor practices. In addition, Apple contracts with the Fair Labor Association to conduct ongoing formal audits of its supply chain across China and other regions and much work is underway in identifying problem areas and corrective plans. To its credit, Foxconn, Apple’s largest contract manufacturer has made some strides in correcting previous labor audit findings.

The timing of this latest China Labor Watch report is a bit suspect since it comes just before Apple’s pending media blitz for new model iPhone announcements. The fact that an undercover investigation has led to these alleged findings should be indicator of practices which factory audit teams are either not discovering, or worker reluctance to identify grievances through formal channels.

As Supply Chain Matters has noted in a previous commentaries related to the Apple supply chain, its transition to a segmented lower-cost supply chain model, in addition to one supporting its higher cost innovative products is still underway, and newer suppliers may be in the midst of adjusting to higher demands for volume and efficiency. None the less, the issues raised by China Labor Watch should warrant additional response from both Jabil and Apple management.

Jabil now joins Apple contract manufacturing suppliers Pegatron and Foxconn as being in the spotlight for alleged labor rights abuses.

Bob Ferrari

Disclosure: The author is a current holder of Apple stock.

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