Samsung discovers child labor evidence, suspends supplier

Samsung discovers child labor evidence, suspends supplier

Summary: Samsung has suspended business with a supplier following the discovery of 'evidence' related to the use of child labor.

TOPICS: Samsung, China

Following allegations of underage workers at a Samsung supplier, the company's investigation has led to the suspension of business between Dongguan Shinyang Electronics and the tech giant.

Last week, nonprofit labor group China Labor Watch accused the South Korean firm of using underage workers within its supply chain. The New York-based organization said that after investigating one of Samsung's suppliers, Shinyang Electronics, the group discovered the use of child labor.

CLW claimed that suppliers like Shinyang Electronics relax hiring practices during busy seasons, and as a result, child labor may be used. The watchdog said these workers will be on the assembly lines "for a period of three to six months, toiling for 11 hours every day without overtime pay, and the factory does not purchase social insurance for them as required by law."

The labor watchdog said Shinyang Electronics was responsible for at least 15 sets of labor violations, including unpaid overtime, a lack of safety training, no social insurance for employees, and blank labor contracts.

Samsung says that in an independent investigation following CLW's allegations, the tech giant found evidence of illegal hiring processes which took place on June 29. Chinese authorities are looking into the case, and it is possible that fake IDs may have been used by minors to secure work at the factory.

Samsung says that after launching an "urgent" investigation into the China watchdog's claims, the electronics giant also discovered "evidence of suspected child labor" at the factory. As a result, Samsung has now suspended business temporarily with Shinyang Electronics.

Samsung maintains it has a "zero tolerance policy" on child labor, and the discovery of evidence is "unfortunate" considering the firm's efforts to prevent the use of underage workers within its supply chain.

On June 30, Samsung published its 2014 sustainability report which states that after inspecting working conditions at 200 suppliers in 2013, "no instances of child labor were found." The company says it has conducted three audits since 2013 at Shinyang Electronics, and the latest audit was concluded on June 25 this year — but there has been no previous evidence to support the idea that the Chinese supplier was using underage workers.

Once the investigations are concluded, if the conclusion reached is that the supplier did hire children, then Samsung says it will "permanently halt business" with Shinyang Electronics. In addition, the company plans to strengthen hiring processes to try and avoid a repeat scenario in the future.

Topics: Samsung, China

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  • Samsung discovers child labor evidence….

    Credit to Samsung for spotting it but the question needs to be asked. Were they at all aware of it in the first place?

    So what is the worst of two evils Tax dodging (Apple) or Child Labor?

    Looked at it in that way the Tax Dodging pales in to insignificance.
    • Tax Dodging

      Your comment on tax dodging is noted but, since it is LEGAL, Apple is doing what is has to do for its shareholders. Otherwise they are not doing their fiduciary duty!
      • Not quite

        Properly defined, fiduciary duty involves treating other people's money with as much care as one would his own. It does not require unethical, but technically legal behavior.

        But I don't blame corporations for trying to minimize their tax liability as long as they stay within the letter and spirit of the law. US personal income tax payers, regardless of class or political affiliation routinely do the same thing. If there are loopholes in the law, the fault lies with legislators, not taxpayers.
        John L. Ries
  • How things change

    Wonder what the people of the 1800's might of thought about the terms; illegal "underage workers" and "child labor." :) OMG... A kid learning how to work!!!! That has to be stopped immediately!
    • Right! What do kids need school for?

      If their dad doesn't own a company, they won't go to college anyway, and the steel mills and candy factories don't need an education. Besides, some jobs require small bodies and there aren't enough adult midgets to fill them.

      Don't flame me, this is only Swiftian satire!
      • That and...

        ...working stiffs with too much education frequently turn into troublemakers.
        John L. Ries
  • all about the money

    What I find confusing is that companies like Apple and Microsoft and many others are making sqillions of dollars and yet, somehow, it's never enough! Trying to increase revenue year on year is a bit of an ask, especially in the current economic climate and, at the end of the day, what difference does it make? They are still making masses of money. I see this kind of share holder driven behavior at the root of the financial problems the world is now facing and as was mentioned above, it encourages tax avoidance. Companies making that kind of money should be doing all they can to be great corporate citizens rather than having to pander to their shareholders.
    • This is the problem with public companies

      It's not what they make, it's how they grow. This is because value in secondary markets will only increase on the growth, yet credit is derived from the share price! It's a ridiculous system that is void of real values. Screw the worker, we need higher share prices! Screw the country that has hosted us, we need higher share prices! Morally bankrupt entities that are formed that way under the banner of business.
  • No work, no eat

    It's sad, but the fact remains that for the majority of these Korean "children" (OK, we're talking about 15 to 17 year old) won't have food or a place to live without a job. It's not like a developed country, so for all of you do-gooders like the China Labor Watch, how does it feel to put kids on the street without food?
    When I was just a poor kid at the age of 14, I made my money from shining shoes. If some do-gooder came along and put me out of a job I would have missed a few good meals....
    • The question is...

      ...was that *your* choice, or your parents'?

      I do think that paid apprenticeships (room, board, and a small stipend are probably just) and night school should be offered as an alternative to full time high school, but an educated citizenry is necessary for the proper functioning of democracy (or any meaningful representative government, for you purists). People have to understand history, have to understand government, have to have a grasp on current events and issues, and have to be able to properly analyze and evaluate what they see, hear, and read to effectively participate in the system and to cast informed votes. To that extent, education is not job training, it's voter training.
      John L. Ries