ie8 fix

Between the Lines

Larry Dignan, Andrew Nusca and Rachel King

Apple's external inspections of Foxconn a good first step

By | February 13, 2012, 6:13am PST

Summary: It’s likely that other tech firms will join the Fair Labor Association and outside audits in Apple’s wake.

Apple said it has asked the Fair Labor Association to audit the company’s Foxconn factories in Shenzhen and Chengdu, China. The move comes after Apple has taken heat for working conditions in its supply chain.

According to Apple, a team of labor rights experts started inspections Monday at Foxconn City. Foxconn makes the iPad and iPhone for Apple. The Fair Labor Association (FLA) described itself this way:

Incorporated in 1999, the Fair Labor Association (FLA) is a collaborative effort of socially responsible companies, colleges and universities, and civil society organizations to improve working conditions in factories around the world. The FLA has developed a Workplace Code of Conduct, based on ILO standards, and created a practical monitoring, remediation and verification process to achieve those standards.

Tim Cook, Apple CEO, said in a statement:

We believe that workers everywhere have the right to a safe and fair work environment, which is why we’ve asked the FLA to independently assess the performance of our largest suppliers.

Cook has bristled at the argument that Apple doesn’t monitor its supply chain conditions. As noted before, Apple isn’t the only company that relies on China manufacturers for its wares.

Also seeApple’s supply chain flap: It’s really about usCNET: Tim Cook: Apple cares about ‘every worker’ in its supply chain

Under Apple’s deal with the Fair Labor Association, inspectors will have unrestricted access to Foxconn, Quanta and Pegatron facilities. Those three contract manufacturers account for 90 percent of Apple’s product assemblies.

Apple, like other technology companies, has published an audit of its supply chain. Third party verification, however, adds a little more meat to those audits.

Apple was among the early supporters of the FLA. The companies in the group, however, are mostly apparel players such as Adidas, Puma, New Balance, Nike, Liz Claiborne and a host of others. It’s likely that other tech firms will join the Fair Labor Association and outside audits in Apple’s wake.

While you can question the FLA’s ability to audit well and whether these third party inspections will have teeth, Apple’s move is a good one that could set off a chain reaction in the tech industry. Here’s a look at what Foxconn’s parent Hon Hai makes. As you can see, there’s a lot more than Apple gear being manufactured at Foxconn.

The big question is whether any audit can track how Foxconn workers are treated. The employee base has ballooned in recent years. Here’s the employee growth via Foxconn’s corporate responsibility report.

Kick off your day with ZDNet's daily e-mail newsletter. It's the freshest tech news and opinion, served hot. Get it.

Topics

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic.

Disclosure

Larry Dignan

Larry Dignan has nothing to disclose. He doesn’t hold investments in the technology companies he covers.

Biography

Larry Dignan

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic. He was most recently Executive Editor of News and Blogs at ZDNet. Prior to that he was executive news editor at eWeek and news editor at Baseline. He also served as the East Coast news editor and finance editor at CNET News.com. Larry has covered the technology and financial services industry since 1995, publishing articles in WallStreetWeek.com, Inter@ctive Week, The New York Times, and Financial Planning magazine. He's a graduate of the Columbia School of Journalism and the University of Delaware.

For daily updates, follow Larry on Twitter.

44
Comments

Join the conversation!

Just In

RE: Apple's external inspections of Foxconn a good first step
Vquest55@... 15th Feb
Big companies only do something when they are caught then only do it until the media attention disappears. No different here. Please no excuses if you believe in treating people right then this doesn't happen in the first place. As usual it is and always will be about $$$$$MONEY$$$$$$. And WE ALL are part of the problem.
Is that graph saying there are near a 100k workers in that Foxconn City plant?

I used to work in a plant that basically had its own town of 10-15k and the facility had over 150 buildings spread over probably 100 acres easily. That Foxconn plant must be massive. It will be interesting to see what kind of 'results' this audit gets.
0 Votes
+ -
@dtdono0 Nope - that's nearly a million workers, although not all in a single plant. Its biggest plant, in Longhua, employs over 230,000.
@dtdono0, I think you may have missed by an order of magnitude. 935,000 not 93,500. (the unit is 10K in the graph not 1K)
@dtdono0

That's total Foxconn employees. They have (according to Wikipedia) 13 plants in China, as well as several in Mexico, Europe, India and Brazil.
0 Votes
+ -
RE: Apple's external inspections of Foxconn a good first step
Snooki_smoosh_smoosh Updated - 13th Feb
"Apple, like other technology companies, has published an audit of its supply chain. Third party verification, however, adds a little more meat to those audits."

Really? like which tech companies? I have looked around on Lenovo, can't find it, and it took some digging to find HP's, it is almost like these companies don't want you to find their audit reports. Apple prominently displays theirs on the main page.

Also, while suicide is an awful thing, anyone ever look at average suicide rates? In the US it is 11.3 people per 100,000 people.
http://www.nimh.nih.gov/health/publications/suicide-in-the-us-statistics-and-prevention/index.shtml

With Foxconn employing nearly 1m people, that means that it would be in line to have 113 suicide attempts given the rate of the US, so in having only 17 attempts per 1m people, that is quite low at a rate of only 1.7 per 100,000.

To be clear that doesn't justify 16 hour work days, or conditions harmful to the health of the workers, or any kind of child labor, but it puts the suicide rate into perspective.

Also given that those 17 attempts were over a decade, that suicide rate at Foxconn is even lower.
@Snooki_smoosh_smoosh
It's not just "16 hour work days" it's sometimes 36 hour shifts, especially when a new iPad, iPhone. Wii or Kindle is coming out. It's 25 cents an hour. They're forced to sign an agreement that they will not hold the company responsible in case of injury, death or suicide. One man committed suicide after losing an iPhone 4 that was his responsibility. If they talk about unions they can get up to 12 years in prison, not to mention the child labor. All these conditions exist while Apple posted record profits of 46 BILLION dollars in the last quarter of 2011. So please, don't try to negate what the conditions are by justifying the suicide rate.
0 Votes
+ -
@chaserblue
Apple is 40% of Foxconn's business but HP is 25%. You going to bust them as well or is it all Apple's fault these people committed suicide?
Apple doesn't dictate the working conditions for these people. You cannot say that Apple's releases of products automatically force the workers to kill themselves or makes Foxconn change their working conditions. It's a communist nation. Foxconn is trying to make a profit and are the sole responsible party for forcing these conditions!
Quit trying to make Apple out to be the bad guy. Blame HP too and our government and the unions for forcing companies off shore with ridiculous regulations. Obama is trying to appease the environmentalist so he can get their votes but what his campaign hasn't brought to light is in one instance he killed 20,000 plus jobs in America. Stupid environmentalist and the Obama administration have brought on way too many regulations that are anti-business and it's killing our country.
@chaserblue You cannot just say 25 cents an hour is an issue, it also depends on the cost of living.
0 Votes
+ -
As I said,
Snooki_smoosh_smoosh 13th Feb
@chaserblue I don't condone the working conditions. The pay factor is arguable given their relatively low standard of living. Again, keep in mind Apple is not the only company that contracts with Foxconn. Foxconn can dictate some terms to Apple if they need to increase pay, or hire more people. Foxconn isn't exactly the victim here either, they are the employer after all.

And if you want to talk about holding the company harmless, review the case of Jamie Leigh Jones and KBR a Haliburton Subsidiary.
@chaserblue Just a thought here, certain MD's/DO's, especially surgeons, regularly do 36 hour shifts.
0 Votes
+ -
@chaserblue No but don't try to figure the rate of the Chinese workers based on a US wage. What IS the prevailing wage in China for factory workers? Also with that $.25 is room and board. And what IS the national suicide rate in Chine vs the suicide rate at Foxconn - aside from your obvious Apple hatred it is quite relevant.

And if you've NEVER worked a 36 hour shift don't even come on here in a huff acting like it's slave labor - I'VE worked a few 36 hour shifts in my time... at the end I was worn out but hardly suicidal.
@chaserblue Not to split hairs but the average Foxconn worker in China makes 51 cents an hour, which is almost double what a Chinese piece goods laborer makes in southern China (home to most of the sweatshops)
@chaserblue
I'm pretty sure it's the Chinese government putting workers in prison, not Foxconn. It's laughable that people are concerned about Foxconn workers but not the Chinese people. Smells like this sudden outrage was financed by Apple's competitors. For those that have not been keeping up with foreign affairs China is still the same totalitarian government that runs over demonstrators with tanks and throws dissenters in jail to rot.
While the suicide rate may be low, take a look at pictures of these plants and see all the nets put up around buildings and bars put on windows. Makes it very hard to accomplish. A lot of suicide attempts are most likely not even reported.
@Snooki_smoosh_smoosh You cannot compare a suicide rate for people working at a company with a national suicide rate.

How many of the suicides in the US are by unemployed people, bankrupt people, terminally ill people or people in white collar jobs?

What is the suicide rate for manufacturing jobs in the US? (Yes, people still make stuff here.) Pretty sure it will be less than the national average.
@Snooki_smoosh_smoosh Wow. SOMEONE did their research.
0 Votes
+ -
@Snooki_smoosh_smoosh

I wonder... where do you get your facts? 17 attempts over a decade? Try 18 attempts and 14 successes between January and November, 2010. if this were indeed well below any national averages then I guess it would be no big deal and the factories would not be increasing wages and improving working conditions... except they are, which means that it is a big deal. Of course you take some incorrect facts, do a little number crunching and try to tell us there's no big deal.

This is a big deal and its good that at least some people outside of the ones jumping off roofs and slitting their wrists are taking it seriously. Its good to see that Apple is taking action (after some people made a big deal about a lower than average suicide rate at the Foxconn plant) and asking for the FLA to conduct independent audits since their own audits found no big deal.

So Apple "prominently" displays their audit report on the main page. Is that the one where they found no big deal about working conditions at the Foxconn plant? Even though 20 Chinese universities conducted their own studies with much different findings?

I didn't mean for my whole post to be so sarcastic but its so difficult to respond to these posts in other other manner.

For the clueless, the labor problem isn't the wages, Foxconn pays plenty well for the areas they have set up shop. How else do you get almost 1 million employees to come live and work at your factory? $.51 an hour is really good money in China, but it would be even better if the employees could go home to their families at the end of a reasonable work day and had all the safety equipment and standards that better developed countries enjoy. Their are many employees who were interviewed by the press once the suicides caused Foxconn to open up their facilities who stated predictably that the working conditions at Foxconn were not bad and much better really than other factories in China. Of course when Foxconn employs over 800,000 people and has an annual turnover rate of 30 to 40% they'd better not complain about their $0.51 an hour job. At roughly double the national average for factory workers in China and Foxconn replacing 320,000 employees a year it wouldn't be a very good idea to complain. Besides it might be the truth that Foxconn is better than some other factories... but that doesn't necessarily make it a great place to work either.
Why is this just limited to Apple? They are not the only tech company that uses Foxconn.
@gribittmep
Cuz there's Apple haters here and they jump at any chance they get. What blows my mind is they aren't blaming HP which is 25% of Foxconn's business and HP isn't even investigating working conditions like Apple is. Where's the haters at when it comes to being fair. There is no such thing as fair when you hate.
Also, what the crap are they blaming Apple for the working conditions at a company they don't control??? Apple's release schedules has no bearing on whether or not a company makes workers work for 36 hours straight. They need to plan better and care about their employees more to not do crap like this but Apple has nothing to do with how Foxconn manages their employees. NOTHING!!!
@rpollard@...
You're right, there's no such thing as being fair to someone or something one hates. That said, Foxconn is a contractor. They submit a tender for a contract. A big part of this tender is the price. If their price isn't right, they won't get the contract. It's easy to turn a blind eye to labour conditions as long as one gets a good deal and then claim to be in no way responsible for the labour conditions of one's contractor.

The inspectors will most likely be bought. They'll recommend a few cheap reforms that basically changes nothing. Foxconn will act on a few of these recommendations, Apple will shout out their altruism from the rooftops and it will be business as usual.
@gribittmep

1. It's not limited to Apple. It's just that the Apple fanbois don't rush out and whine when it happens to everyone else. HP weathered similar attention twelve years ago.

2. Why now? Apple has been making their crap on the same lines as everyone else for 12 years. Easy.

2.a. Apple says they're different. Well, turns out they're not.
2.b. It's about the margins. HP margins on products from Foxconn are garbage. A lot of what they get are plastic boxes for 3Com(in China for China). People who can only afford a $400 laptop will tolerate that. Apple has 100% unit margins. It's harder to justify.
0 Votes
+ -
Very true...
JCitizen 13th Feb
@tkejlboom ;

and I always wonder if they(Apple, etc.), bother to inspect the hardware to make sure the Chinese aren't doping the chips to spy on us or otherwise create other illegal mischief!
0 Votes
+ -
@tkejlboom Nope it's that there are few HP Haters as opposed to you Apple Haters - so when HP was in a similar situation there was not the same outcry as it is now because NOW Apple is involved. And yet it's APPLE who is the only tech company so far that is getting a 3rd party independent contractor in to evaluate the Foxconn and other factories they use. But let me guess somehow the results will be skewed because Apple can do no right. Where is HP with a 3rd party independent contractor? Nintendo? Toshiba?

Cue the Double Standards.
0 Votes
+ -
@tkejlboom "HP weathered similar attention twelve years ago."

I'm not sure precisely what you're referring to here, but it seems that:

At some time over the 12 years since HP was last scrutinised for its labour practices, they began subcontracting workers under conditions that are comparable to the working conditions of Apple subcontractors.

Wow.
"Fair Labor" is doublespeak for "government takeover" of the industry.

As if people cannot decide for themselves, where they should work, how they should work. We need oversight from a "fairness committee".

Bend over komrades.
@clifftrapp
I am sorry that you are so narrow minded. If there is no regulation for anything, any country will look like stone age, (i.e. survival of the fitness.) So, I suppose you want to sit on your lazy butt watching TV, and expecting slaves to work for you? You sound like you live in the middle of nowhere and don't even bother to care for anything or anyone but yourself. You would not know if yourself is being throwing into the wolf pack. You just add yourself to the list that make many countries hate US because of your arrogant extremist right-wing. For your info, I am neither right or left but rather have a hume conscience and will do what's right so I never feel guilty for any reason. Open your mind and think about others for an change. If you see everyone over in China is a commi than you are yourself not only a hypocrite but even a nazi which I hope other don't see you portrait yourself as one. Grow up!
Here we go again - blame the unions for "ridiculous regulations" and for forcing corporations offshore. The unions are simply trying to assure a fair wage and decent working conditions for their members. Perhaps 25 cent an hour rates, 36 hour shifts, and 2 week stints without days off are appealing to some folks, but not to me. Corporate greed is what takes companies offshore, not unions. The mere fact that simply "talking" about unions can result in a 12 year prison term is very telling. I applaud Apple's action, but I question its validity or effectiveness. Thank God for unions - I like days off, a fair wage for all hours worked, and decent working conditions.
@n1sc73@...
Bull, the unions are the some of the greediest and most violent organizations out there. They were once the good guys. But now they're no better than the mafia. They are pretty smart. They spend millions lobbying and paying for their presidential choice.
There are plenty of laws in the U.S. that protect people from Chinese type labor practices. We don't need the union to drive the price of producing products so high that companies have to close their doors or move off shore.
So I say BULL!!! They shouldn't be forcing companies to pay people $40.00 an hour to sweep a floor. That's not a fair wage, that's losing companies.
0 Votes
+ -
@rpollard@... Right - because CEOs don't make 300+ x the hourly rate of their rank and file workers... including that floor sweeper making $40/hr and NOT including the benefits such as stock options. Oh wait - they DO make 300+ x the hourly rate and they DO get stock options and other benefits the rank and file worker drone does not see but it is the fault of the guy sweeping the floor for $40/hr and actually working.
0 Votes
+ -
@rpollard@...- Interesting math you use, where'd you learn it? 3,000,000 new jobs in three years does not equal a loss of 20,000 jobs, unless you never learned basic addition and subtraction (a third grade subject, I believe). And "anti-business" regulations? You're kidding, right? Under Obama, a lot of older regulations have been removed and there have been far fewer new regs than there were under Bush during his first three years. Of course, Obama came into office the month that over 800,000 jobs were lost and half a million or more has been disappearing for nearly a year before he was sworn in, whereas Bush was sworn in when there was a quarter billion dollar surplus and a projected $6 trillion surplus over the next ten years. Bush promptly passed tax breaks to "give that surplus back to the taxpayers" but the vast majority of it went to the wealthiest, then another $6 trillion was spent- a $12 trillion change in 8 years.
But, I'm sure you believe that Bush was so much better at handling the economy than Obama, right?
@xplorer1959
Ah, another liberal that believes everything Oblama spouts. He stopped the pipeline coming in from Canada because of a invalid environmental concern. I have a list of stupid things he's done but look them up for yourself and quit believing everything out of his mouth. He just wants to get re-elected so he can continue taking his 30 to 50 people to Hawaii on vacation. Can't say that I blame him but I wouldn't let people know I was taking extended vacations with relatives, friends, neighbors and the postman.
My dog can handle the economy better than Obama. He's been throwing it over the fence for his "super committee" to solve and then blaming the Republicans for it not getting done.
Yep, you're listening to liberal news media for your information. Bush is the blame for world hunger and third world wars as well, eh?
0 Votes
+ -
Jobs was such a micro-manager that Apple had to be totally aware of the conditions at Foxconn, this announcement was for appearances only and I doubt that it will have any impact what so ever on the conditions at Foxconn.
World should unite and stop the terror and lies from Apple Inc.
0 Votes
+ -
Especially when they come across as "greenie" and "feel good!" "Green" means money and "feel good" is for when they profit. Don't be fooled, there's nothing positive and righteous about Apple Computer. They are just as enslaving and devious as anyone else. They just put up a different front than the rest and that's all there is to it. They are just a big tech company hooked in with the big [fill in the blank -] industrial complexes operating as a simple company. Vote with your dollars.
@Jow_Blow "Don't be fooled, there's nothing positive and righteous about Apple Computer."

They are number 4 in the Greenpeace Environmental Ratings (2011) and would be higher if they had bothered writing a Clean Energy Report, regardless of whether they planned to stick to it. (That's what Samsung did.)

Otherwise, they are certainly a big technology company, and like any company they are required to do their best to make a profit for their share holders.

While it's hard to be too enthusiastic about wealthy multinational companies, Apple are innovative and their products are good.

(This will trigger the usual round of rubbish about Apple 'stealing' the mouse and GUI from Xerox PARC hence (?) Microsoft had every "moral right" to copy Apple. And how the Apple "walled garden" is evil, and will remain evil until Microsoft gets their app store running. And how Apple have failed to innovate in any way, despite the fact that five years ago touch-screen smart phones and tablets were, at best, a niche curiosity rather than the fastest grower IT sector...)
@ rpollard@...
"Apple doesn't dictate the working conditions for these people."
Don't kid yourself. That's exactly why they're in China. To get that much work done for that much money. Don't make it sound like the benevolent loving company has been betrayed by the evil Chinese contractor...
@kallingham@...
And what do you think HP is using Foxconn for? Where's the Apple haters when they find out HP is 25% of Foxconn's business? HUH???
The main reason they and HP and other electronics companies are in China is supply lines. They are about to mass produce a $25.00 computer but had to go to China because of regulations and taxes in the UK that would make it impossible to make any money on it. The main reason is that all the electronic components are in China. So, it cost extra to have them shipped here and they would be taxed on the parts versus the finished components.

ARE YOU SERIOUS??? You really think Apple went to China because they knew that they abused their workers and wanted to reward them for it?
This mob mentality is getting out of hand on this blog. People are absolutely blood crazed convincing each other that Apple purposely uses companies in China that abuse their employees.
0 Votes
+ -
@kallingham@... "Apple doesn't dictate the working conditions for these people." NO they do NOT dictate the working conditions. Neither does HP, Toshiba, Nintendo, or any of the other tech companies that use Foxconn and other Chinese factories. But wait, would that mean that ALL of them were betrayed by the evil Chinese contractor...

Let me guess, it's okay with HP, Toshiba, Nintendo, etc. because none of them are Apple... Cue the Double Standards.
When push comes to shove ($$$$$) nothing will change. Count on it.
steve Jobs originally built Apple's (I, IIs etc) and early Macs in the U.S. After leaving apple he even built NEXT computers in Fremont california. Building in the U.S added estimated hundreds of dollars to costs.

So the public loaded up on American branded made in Asia PCs and also Acers, Asus, Samsungs etc. The same press and haters beating jup on Apple now praised PC makers for out sourcing to bring 'affordable computing to america'. Apple PC market share dropped from 30% to 2%.

Steve Jobs couldn't even sell NEXT machines which were wonders at the time (Unix, object oriented, multithreaded etc) to Government funded colleges or the government (now politicians are complaining why Apple doesn't have manufacturing in the U.S !!!).

Jobs hired Tim Cook who used to work for IBM and Compaq to straighten out Apple's supply chain. Now Apple uses suppliers like the rest have been using for YEARS except Apple audits them better.

(weird nobody complained when Dell, HP, Acer etc -- you know as haters and Ballmer loves to remind us : 90% of the computing market -- used asian factories like Foxconn or as the Chinese press states WORSE than foxconn for years. Eg: commentator in Chinese Press : "If not to buy Apple, whats the substitute Samsung? Dont you know that Samsungs products are from its OEM factory in Tianjin? Samsung workers income and benefits are even worse than those at Foxconn. If not to buy iPad (do you think) I will buy Android Pad? Have you ever been to the OEM factories for Lenovo and ASUS? Quanta, Compaq factories of other companies are all worse than those for Apple. Not to buy iPod (do you think) I will buy Aigo, Meizu? Do you know that Aigos Shenzhen factory will not pay their workers until the 19th of the second month? If you were to quit, fine, Im sorry, your salary will be withdrawn. Foxconn never dares to do such things. First, their profit margin is higher than peers as they manufacture for Apple. Second, at least those foreign devils will regularly audit factories. Domestic brands will never care if workers live or die. I am not speaking for Foxconn. I am just speaking as an insider of this industry, and telling you some disturbing truth," comment posted by Caixin"

Does anybody believe $250 netbooks are built in paradise factories? I've NEVER seen article in Zdnet etc complaining about netbook factories. )

Now Apple is using Asian suppliers like the PC guys Bill Gates can't make "PCs are cheap, Apple stuff is expensive ads" as PC OEMs can no longer undercut Apple's iPads, iPhones etc except by making a loss.
This is hillarious! An American (Left Wing, Liberal) company, (Incorporated in 1999, the Fair Labor Association (FLA) is a collaborative effort of socially responsible companies, colleges and universities, and civil society organizations) is going to Communist China to inquire about their labor practices with regard to American companies. Do bear in mind however, the Communist Ideal is Utopia for the Progressives. Wonders will never cease!
0 Votes
+ -
Great logic Mr. Cook. To follow that to logical absurdity, if I murdered someone then my defense plea could be, "But lots of other people murder too!"
apple needs to address the entire supply chain, including conflict minerals which results in the murder and rape of women and children in africa. apple has long been aware of this, the late steve jobs stated in 2009 the issue was too difficult to address, i (& others) say the issue is too horrific not to address. see the "enough project" and "raise hope for congo" web sites for more information.
Big companies only do something when they are caught then only do it until the media attention disappears. No different here. Please no excuses if you believe in treating people right then this doesn't happen in the first place. As usual it is and always will be about $$$$$MONEY$$$$$$. And WE ALL are part of the problem.

Join the conversation!

Formatting +
BB Codes - Note: HTML is not supported in forums
  • [b] Bold [/b]
  • [i] Italic [/i]
  • [u] Underline [/u]
  • [s] Strikethrough [/s]
  • [q] "Quote" [/q]
  • [ol][*] 1. Ordered List [/ol]
  • [ul][*] · Unordered List [/ul]
  • [pre] Preformat [/pre]
  • [quote] "Blockquote" [/quote]
ie8 fix

The best of ZDNet, delivered

ZDNet Newsletters

Get the best of ZDNet delivered straight to your inbox

Facebook Activity

White Papers, Webcasts, & Resources
ie8 fix