By Scott Nova and Isaac Shapiro
Information from Apple’s own factory auditor, the Fair Labor Association, and new reports in Chinese media show that the iPhone 5 is being produced by employees:
- Who work far more hours than allowed by Chinese law;
- Who are not paid for all the hours they work;
- Who lack any true voice in the workplace to advocate for necessary reforms
- Who partly consist of thousands of students who are being coerced to work, in a practice that Chinese media outlets characterize as “forced labor”
In short, any excitement over any new capabilities of the iPhone 5 demands to be tempered by a realistic appraisal of the unacceptable working conditions for the Chinese workers producing it. These conditions are explained in some detail below; a fuller analysis by our organizations of what changes in labor practices have and have not been made at Foxconn (Apple’s lead supplier in China) over the past year is forthcoming.
iPhone 5 workers face illegal overtime hours
In March of this year, in a study done at the behest of Apple itself, the Fair Labor Association found that Foxconn workers frequently worked more than 20 hours of overtime per week, with their overtime hours far exceeding China’s legal limitation of 36 hours per month (equivalent to about 9 hours per week). FLA’s interim “progress report” released in August claims that Foxconn is now meeting the interim goal established by the FLA of limiting the work hours of employees to 60 hours per week, or to 20 hours of overtime per week—a standard which falls far short of compliance with the law.
It is not entirely clear that that even this weak standard is being met as iPhone 5 production is being ramped up; see below. Further, the Hong Kong-based group Students and Scholars Against Corporate Misbehavior (SACOM) and China Labor Watch have both reported that to the degree work hours have been reduced, the intensity of work has increased; that is, workers are expected to produce similar amounts of work in fewer hours.
But even if a 60-hour per week standard were being achieved with a reasonable work load, a 60-hour per week standard means that in the production of the iPhone 5 and other products, Foxconn is still subjecting many workers to more than twice the maximum monthly lawful number of overtime hours. Standards at Apple’s China suppliers other than Foxconn may be even worse, according to a recent study by China Labor Watch.
The FLA says the next step for Foxconn, to be achieved by July 2013, is to ensure that employees work no longer than is permitted by Chinese law. The basis for allowing Apple and Foxconn to continue to break the law in the meanwhile is dubious at best, particularly since both Apple and Foxconn have been promising to stop this behavior since 2006. To be sure, if Foxconn were not breaking the law now, this could cause substantial inconvenience for Apple in the form of iPhone 5 delivery delays; however, there appears to be no basis in Chinese law or any applicable code of conduct for temporarily exempting companies from their labor rights obligations based on convenience.
iPhone 5 workers are not paid for all the hours they work
The FLA also reported in March that Foxconn would, as part of its corrective action plan, henceforth “ensure full payment of all hours of work including overtime (and fractions thereof)…” The purpose of this remedial action was to eliminate the common Foxconn management practice of not paying workers for any unscheduled overtime worked until they reach a 30-minute threshold.
The August FLA report indicates that rather than eliminating the practice of paying workers nothing until they have exceeded a threshold of overtime minutes, Foxconn has merely reduced the threshold—from 30 minutes to 15. The Appendix covering conditions at the Longhua factory states as follows: “Based on workers’ hours and payment records, working periods of less than 15 minutes were not paid, and working periods exceeding 15 but less than 30 minutes were paid as 15 minutes.” The report also indicates that this is now the policy at all of the factories.
Although the FLA does not acknowledge it, this policy continues to violate Chinese law and the principle that workers should be paid for all of the hours they work. Many workers will continue to lose significant amounts of pay. For example, a worker who is asked on a regular basis to stay for 25 minutes after work will lose 10 minutes of pay per day, an hour’s pay per six-day workweek, and 50 hours of pay over the course of a year.
Workers at Apple suppliers in China still have no voice in the workplace
To the degree unjustified working conditions continue in Foxconn factories, as well as in other factories in China involved in the production of the iPhone 5, the workers themselves have almost no ability to push for reforms.
In its March press release, the FLA claimed it secured commitments to “establish a genuine voice for workers” at the Foxconn factories. Such a voice has been altogether lacking at these factories, with, for example, “union committees” consisting almost completely of management staff.
In its August report, the FLA gives Foxconn credit for ‘reforms’ in this area, but upon closer inspection it is clear the changes hardly constitute providing workers with a genuine voice. At the Guanlan factory, for example, the FLA gives Foxconn credit for changing the composition of its union committee from 40 managerial staff and two workers (nominated by management) to 30 management representatives (including engineers) and 20 workers (elected by workers in 2014). In other words, the FLA gives Foxconn full credit for a reform that would still leave workers as a minority in the union committee and that would not begin to elect worker representatives until at least 17 months from now. The delay by itself means the iPhone 5 is being produced absent any true worker voice.
The “reform” the August FLA report highlights at the Longhua factory is even more meaningless. The current union committee has two workers out of 50 members. The reform that was given full credit by the FLA: this figure would be bumped up to at least three.
Coerced student labor used in iPhone 5 production
Media reports in China indicate that to make up for a worker shortfall, students in China have been coerced to work on iPhone 5 production. A Sept. 6 story in the Shanghai Daily begins:
“Thousands of students in an east China city are being forced to work at a Foxconn plant after classes were suspended at the beginning of the new semester, it has been revealed.
Students from Huai’an in Jiangsu Province were driven to a factory in the city run by Taiwan’s Foxconn Technology Company after the plant couldn’t find sufficient workers for the production of Apple’s much-anticipated iPhone 5, they said in online posts.”
A story by China National Radio had similar findings (we can supply an unofficial English translation of this story upon request). The Shanghai Daily story also revealed that the students were working six days a week, 12 hours a day. Note that this work week not only far exceeds that allowed by Chinese law, it also exceeds the 60-hour weekly limit the FLA claims has been achieved.
*Scott Nova is Executive Director of the Worker Rights Consortium. Isaac Shapiro is a Research Associate at EPI specializing in regulation and labor policy.