Foxconn, which makes more of our electronic devices than any other manufacturer in the world, said it would improve pay and working conditions in its Chinese factories, according to a new report, a move that could lead to higher costs for U.S. firms.
Nearly all leading high-tech companies in the United States rely on Foxconn to produce their most popular gadgets, including Apple’s iPad, Microsoft’s Xbox gaming console and personal computers from Dell and Hewlett-Packard.
The pledge, which could also propel broader labor reform in China, was announced in an audit report by the Fair Labor Association, which found that more than half of the employees at Foxconn’s assembly plants for Apple exceeded the company’s limit of 60 hours of work a week. The labor group also reported hazardous working conditions that put lives at risk.
The group’s report, which was requested by Apple in January, confirmed the concerns of labor critics who have said Apple’s wildly popular products have come at too high a cost to workers overseas.
Apple spokesman Steve Dowling said the company agrees with the findings and will work to implement its recommendations, including reducing worker hours.
“We think empowering workers and helping them understand their rights is essential,” Dowling said, adding that Apple is working to make its supply chain “a model for the industry.”
But that model could be more expensive for Apple — and its rivals.
Foxconn said it would cut back on working hours to comply with regulations by July 1, 2013. But it warned that it would need to hire “thousands” of extra workers to meet the same levels of output and quality — costs that could be passed onto U.S. companies and consumers.
Meanwhile, some labor activists cast doubt on whether the FLA report would actually lead to change.
“Once the audits are over and FLA has gone home, the workers in the factories will again be left to deal, as best they can, with the brutal labor conditions that are imposed on them,” according to a joint statement by five groups, including the International Metalworkers’ Federation and the International Trade Union Confederation.
FLA auditors found that some employees worked more than seven days in a row without stopping, despite requirements that workers have at least a 24-hour break. More than 50 percent of workers at each of the factories audited exceeded the legal limit on overtime — 36 hours per month.
The auditors also found urgent health and safety issues, including the presence of aluminum dust, which caused a fatal explosion at a plant in Chengdu, China, in 2011. Workers surveyed said that they had “low levels of confidence” in management’s ability to deal with such concerns and that committees dedicated to worker safety “do not proactively monitor conditions.”
Workers told the FLA that they would like to see more communication with management. The labor group criticized Foxconn’s efforts to make workers aware of labor laws.
Such problems, the labor group said in a statement, have led to “a widespread sense of unsafe working conditions among workers.”
About 35,000 non-managerial workers were selected at random from three assembly plants. About 10,000 workers from the Guanlan and Chengdu factories were surveyed; about 8,000 were surveyed at Longhua. Workers completed the anonymous questionnaire on a computer or iPad and had “space for privacy” while answering the questions.
In Apple’s own report, which covered scores of facilities worldwide, the company found that workers in 62 percent of its audited facilities put in more than 60 hours per week last year.
As of February, the company said, 89 percent of Apple’s suppliers were in compliance with a 6o-hour workweek. On average, Apple said, workers labored 48 hours a week.
The report was published on the heels of Tim Cook’s first trip to China as Apple’s chief executive. Cook met with Chinese Vice Premier Li Keqiang and toured Foxconn facilities in Zhengzhou.
Analysts say Cook’s visit to China shows that the company is working to strengthen ties with the country. The company has targeted mainland China as a primary growth market, where demand for Apple products is skyrocketing. Some predict that Apple could sell as many as 40 million iPhones in China by the end of the year.