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Watchdog group China Labour Watch (CLW) condemned tech giant Apple yesterday for failing to monitor its suppliers’ standards effectively.
The pressure group said this allowed contracting companies such as the Taiwanese Pegatron Corporation to keep wages below living costs.
Low costs helped Pegatron win business from Apple after an increase in labour costs at existing supplier Foxconn aimed at addressing a spate of worker suicides in 2010.
The CLW report came on the same day that Apple published its 2015 Supplier Responsibility Progress Report, which showed a decline in compliance on working hours.
“Apple constantly claims it is monitoring suppliers’ compliance with labour standards,” CLW said.
“But Apple consistently suppresses labour costs by shifting production to the cheapest manufacturer.”
Pegatron assembles Apple devices at two factories in China. Apple and Pegatron both declined to comment.
The CLW review is the latest survey of labour practices at Apple suppliers in which pay and working conditions have been criticised.
A report from another labour group in August detailed excessive overtime and unpaid wages.
Such reports have forced Apple into defining labour standards for suppliers and hiring third-party auditors to enforce compliance.
But CLW pointed out that Apple’s pursuit of low costs encouraged suppliers to cut corners.
Apple claims it tracks over 1.1 million workers per week and that suppliers achieved 92 per cent compliance with its 60-hour maximum working week in 2014, a drop from from 95 per cent in 2013.
Apple senior vice-president of operations Jeff Williams insisted that the company “consistently reports suppliers’ violations of our standards.
“People sometimes point to the discovery of problems as evidence that our process isn’t working. Nothing could be further from the truth.”
At Pegatron’s Shanghai factory, which assembles iPhones and iPads, CLW said average hourly labour cost per worker in 2014 was 8 per cent lower than at Foxconn’s Longhua plant, which also assembles Apple devices. This saved Pegatron $61 million (£39m), CLW said.
Pegatron keeps labour costs down by paying low basic rates, which compel workers to work 90 to 100 hours of overtime each month, the rights group said.
