'Significant issues' found in Foxconn factories

Audit of factories supplying Apple products finds problems such as excessive overtime, safety, health and communication gaps, which Cupertino and Foxconn promise to fix.
Written by Liau Yun Qing, Contributor

Investigations of three Foxconn factories that supply Apple products reveal "significant issues" such as excessive overtime and problems with overtime compensation, note labor rights watchdog. Apple and Foxconn agree to remedy issues, by improving wages and working conditions.

In a statement Friday, the Fair Labor Association (FLA) announced the results of its inspection of the three Foxconn factories which supply Apple products. The audit began in February and was facilitated by Apple, which joined the FLA a month earlier in response to public criticism over working conditions in its supply chain.

Auret van Heerden, President and CEO of the FLA, said: "The Fair Labor Association gave Apple's largest supplier the equivalent of a full-body scan through 3,000 staff hours investigating three of its factories and surveying more than 35,000 workers. Apple and its supplier Foxconn have agreed to our prescriptions, and we will verify progress and report publicly."

'Significant issues' found
Among the problems found were excessive overtime, problems with overtime compensation, several health and safety risks.

The report also pointed out communication gaps due to the union being dominated by management which did not provide a true worker representation, whic Foxconn agreed to fix by ensuring the election of worker representatives without management interference.

According to FLA, over the last 12 months, all three factories exceeded both the 60 hours per week FLA Code standard and Chinese legal limits of 40 hours per week and a maximum of 36 hours overtime per month. During peak production periods, the average number of working hours per week exceeded 60 hours per worker with some employees working more than seven days in a row, it said.

FLA said Foxconn has "committed" to fully comply with the Chinese legal limits and FLA standard of working hours by 2013. It will limit its working hours to 49 hours per week which includes overtime, a drop from monthly overtime of 80 to 36.

"More importantly, while employees will work fewer hours, Foxconn has agreed to develop a compensation package that protects workers from losing income due to reduced overtime," the statement added. As part of those plans Foxconn would "in order to maintain capacity while reducing workers' hours" commit to increasing its workforce significantly and build more housing and canteen capacity.

The assessment was based on visual observations and review of policies, procedures and documentation such as payroll and time records, production schedules and employee records. FLA also interviewed hundreds of Foxconn workers and managers, as well as conducted an anonymous survey of 35,500 randomly-selected workers.

Prior to the release of the audit results, Foxconn had been working to improve working conditions of its factories such as creating new positions for a safety and security officer, a lifestyle services manager and two fire chiefs, according to a report.

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