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Apple's Cook Steamed Over Labor Practices Report

By Richard Adhikari MacNewsWorld ECT News Network
Jan 27, 2012 3:18 PM PT

Since the middle of this week, the buzz about Apple hasn't been so much its record earnings as disclosures of the working conditions its overseas workers endure, as detailed in The New York Times.

Apple's Cook Steamed Over Labor Practices Report

The report touched on worker deaths, inhumane working conditions, disregard for workers' health, the use of underage workers, suggestions that Cupertino cares only about cutting costs and maintaining product quality, and allegations of infighting among senior management at Apple over these issues.

This story is part of an ongoing series the paper's working on named "iEconomy" that looks at challenges posed by the increased globalization of high-tech industries.

An open Facebook chat regarding the series is posted here.

Cook Strikes Back

Apple CEO Tim Cook has apparently responded to the article with a memo published by the 9 to 5 blog. In it, he calls the allegations "offensive."

"Steve Jobs wasn't known for his empathy and only appeared concerned with working conditions overseas when there was a serious threat to the Apple brand," Rob Enderle, principal analyst at the Enderle Group, told MacNewsWorld. "Cook is far more empathetic and he likely disagreed with Jobs' approach to the problem."

Still, the focus on protecting Apple's brand did motivate the company to "implement some of the most rigorous auditing programs in the industry," Enderle pointed out.

Apple did not respond to our request for further details.

Apple's Contractors

Workers in factories run by Apple's overseas contractors live in crowded dorms; work excessive overtime, sometimes seven days a week; and in some cases stand for so long that their legs swell and they can hardly walk, according to the report. Underaged workers have been used, and suppliers have improperly disposed of hazardous waste and falsified records, the Times reported.

There have been explosions at factories owned by Foxconn, which produces the bulk of Apple's iDevices. Two years ago, 137 workers at an Apple supplier's plant in eastern China were reportedly injured when they obeyed orders to clean iPhone screens with a poisonous chemical.

So many workers committed suicide at Foxconn's plants that the company reportedly makes new workers sign a pact pledging not to do away with themselves.

Who Can Make Things Better?

Apple audits the plants of its overseas suppliers, and it consistently finds violations of its policies. Although it warns that suppliers will be terminated for breaches, fewer than 15 suppliers have been dismissed since 2007, former Apple executives told the Times.

To be fair, several other large American high-tech companies, including HP and Microsoft, outsource production to Foxconn, meaning they too have to deal with similar problems.

"Large OEMs have significant sway over their suppliers' behavior," Casey Harrell, an organizer with Greenpeace International, told MacNewsWorld.

"We've seen this on issues of supply chain management on various environmental issues such as alternatives to toxic materials and energy efficiency," Harrell continued. "If companies want to -- or more likely, are pushed to -- make changes in their supply chain, they can, and will still make a profit, given the high margins. Apple had more cash on hand in reserves at one point than the U.S. government."

Cupertino has twice hired Business for Social Responsibility to provide advice on labor issues, but the organization reportedly said Apple's motivation is to avoid embarrassment rather than pre-empt problems.

BSR did not respond to our request to comment for this story.

Working to Make a Change

Apparently, senior management is divided over the issue of how foreign suppliers treat their staff.

Apple does seem to be trying to make further improvements. It joined the Fair Labor Association earlier this month, agreeing to let outside monitors into suppliers' factories.

More work may be needed -- Foxconn CEO Terry Gou referred to his workers as animals during an appearance at the Taipei City Zoo last week, Labor Notes reported.

"We see a lot of companies stuck in the cycle of doing less bad rather than doing good," Greenpeace's Harrell remarked.

On the other hand, vendors are often neither able to create nor enforce laws abroad, Enderle pointed out.

Further, conditions at overseas suppliers' plants "are a result of local government policies and, if a contract is cancelled, the people you're trying to protect either become unemployed or may find themselves in an even less favorable environment," he warned.

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