Apple, Inc. Working Conditions Report Fails To Tell Full Story

Apple, Inc. Working Conditions Report Fails To Tell Full Story
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Apple Inc. (NASDAQ:AAPL) has been praised for many things during its existence, but the quality of the working conditions that the staff who manufacture its products are able to enjoy has not really been one of them. Apple has relied for the most part on East Asian production facilities, with the notorious company Foxconn Technology Co., Ltd. (TPE:2354) (OTCMKTS:FXCOF) responsible for constructing many Apple products, such as the iPhone and iPad. Quite frequently, investigations into conditions in some of the factories run by Foxconn have revealed a less-than-happy story, and this has been a perennial media topic for quite some time.

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Apple’s supplier responsibility report released

Well, perhaps in response to some of those stories, Apple is today claiming that it has been successful in improving conditions across its international supply chain. The release of a ‘Supplier Responsibility’ report by Apple suggests that the corporation has systematically and successfully addressed the issue of poor worker conditions. But it also painted a picture of a situation which would still benefit from considerable improvement.

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According to figures released by Apple today, the company increased the number of audits which occur in its supply chain to over 450 last year; obviously more than one per day. This is significantly more than took place during the previous calendar year when there were under 300, and the audit program for this year represents an increase of over 50 percent.

But bear in mind that these audits are spanning a vast supply chain of over 1.5 million workers. It’s not as if these audits will be able to take in the opinions of every worker! Even given the increase of audits which have taken place this year, there are still well over 3,000 workers per audit, meaning that only very vague impressions can conceivably have been gathered.

Apple Inc. (NASDAQ:AAPL), though, was also keen to emphasize the educational opportunities that had been afforded to workers during the calendar year. Apple stated that it has gone to great lengths to ensure that every worker within its supply chain is trained on their rights, and has now increased the number of educated workers in its supply chain to 3.8 million since 2007.

Anti-discrimination failure

While this paints a more positive picture of a workforce that is often decried as being exploited to some degree, elsewhere the figures weren’t so popular for the consumer electronics powerhouse. The company were forced to reveal that only 87 percent of the factories it audited last year were in compliance with its anti-discrimination policies. In common with many other companies and with the legal framework in this area, Apple’s policies require people to be employed regardless of their race, age, gender, and several other attributes over which they have no control. This was obviously significantly short of what could have been expected, and it would be interesting to know precisely how they had so spectacularly failed in this area.

One failing is absolutely clear, though. Apple had found four of its facilities to be conducting pregnancy testing in violation of its anti-discrimination policies. This is an extremely prickly issue given that such conduct would be considered nothing short of outrageous in the West. It is also rather redolent of such grisly issues as China’s one-child policy, and while there is no explicit link between the two, it won’t exactly please people who care about human rights to read that Apple workers were discriminated against for being pregnant by its own admission!

There was better news elsewhere for the corporation, with Apple scoring rather better in terms of treating workers fairly (96 percent compliance), percentage of underage labor (97 percent) and freedom of association (99 percent). Critics might not unreasonably assert that all of those figures should read 100 percent, particularly the underage labor statistic, but at least they’re not as damning as the previous figure related to anti-discrimination. Considering that Apple found that 50 of its facilities failed to provide juvenile workers with free health exams, violating the company’s policies in this area, then it is clear that conditions for workers can be far from exemplary in Apple’s supply chain.

It was only this week that Apple Inc. (NASDAQ:AAPL)’s Foxconn supplier was linked with replacing at least some of the 600 people who are required to construct an iPhone with robots. Aside from the obvious economic benefits of this policy, cynics might point out that robots don’t do inconvenient things such as unionize, demand more pay and better working conditions or get pregnant! But if Apple is serious about being viewed as an ethical company – which it has certainly attempted to suggest it is implicitly with its ‘think different’ slogan – then it quite simply must do much better than this.

ABC News report

Numerous investigations by Western media have found that, regardless of the picture which Apple wishes to paint, pay and conditions within Apple’s supply chain are far from ideal. In 2012, ABC News took its cameras into a range of Foxconn factories, and found that conditions were pretty poor, to say the least, for workers that can expect to earn less than $2 per hour.

While Apple does deserve at least some credit for addressing this issue, overall this report smacks of PR rather than a genuine attempt to address the issue of poor labor conditions. It is well known that Apple Inc. (NASDAQ:AAPL) is a hugely cash rich company; they no longer have any excuse for some of the conditions its workers endure.

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  1. Your story would be stronger and more accurate if you compared Apple’s Working Conditions report to those published by its competitors.

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