Apple Supplier Working Conditions: New Report Cites Overtime Violations

The working conditions in China at Apple supplier factories may be getting worse, according to a new report from China Labor Watch, despite efforts to improve the situation. The report alleges that labor conditions at Pegatron, a Taiwanese contract manufacturer and Apple supplier, has declined over the past year.

As per Apple’s existing policy, supply chain workers are prohibited from working over 60 hours a week and are mandated to receive at least one day off per week. But the China Labor Watch interviewed workers at Pegatron’s Shanghai factory reviewed pay stubs to find ”excessive and illegal” overtime work to be rampant within the company.

In March 2016, 62 percent of employees worked more than 100 hours of overtime and one worker, in particular, clocked in 109 hours of overtime. A violation of overtime policies is not limited to employees, as the nonprofit group also found student interns illegally work, on average, 80 hours of overtime per month.

The report cites low wages as a reason for why workers are opting to work overtime. Despite a rise in minimum wage—from $304 a month to $330 a month—workers received less wages. By reviewing the pay stubs, the China Labor Watch claims Pegatron changed bonus structures and lowered social insurance, resulting in lower wages. After deductions, Pegatrong workers bring home about $213.

“Working conditions are terrible, and workers are subject to terrible treatment,” writes the New York-based nonprofit in the report. “Currently, Apple’s profits are declining, and the effects of this decline have been passed on to suppliers. To mitigate the impact, Pegatron has taken some covert measures to exploit workers.”

Since becoming CEO, Tim Cook has vocalized his dedication to improving worker conditions. “Apple takes working conditions very seriously,” said Cook at the 2012 Goldman Sachs Technology and Internet Conference. “We take the conditions of workers very seriously. I worked in factories, I worked at a paper mill. We understand working conditions at a very granular level.”

Despite making changes, implementing policy has proven to be difficult for the California-based tech giant. In 2012, The New York Times highlighted the human cost of working in an Apple supplier’s factory and in 2014, a BBC investigation spotlighted poor working conditions.

Prior to publishing the new report, China Labor Watch gave Apple the opportunity to respond. The tech giant “admitted that in some production departments of Pegatron, excessive overtime did exist, but the percentage of overtime violation was lower than [China Labor Watch’s] statistics.”