The results of an audit of three Foxconn factories that manufacture Apple products has turned up "serious and pressing" violations of Chinese labor laws, according to a report by the Fair Labor Association, a non-profit commissioned by Apple to investigate Foxconn's facilities.
A team of five to seven inspectors from the FLA visited three different Foxconn factories -- two in Shenzhen, one in Chengdu -- and spent up to five days at each conducting hundreds of interviews with workers and managers in an attempt to understand what labor problems existed at the manufacturing facilities of China's largest employer.
According to the FLA's 13 page report, the non-profit "observed at least 50 issues related to the FLA Code and Chinese labor law, including in the following areas: health and safety, worker integration and communication, and wages and working hours." (See the full report below.)
Here's an overview of the violations and discontents the FLA uncovered at the Foxconn factories:
Overtime pay policies can shortchange workers.
From the FLA report:
The assessors discovered that unscheduled overtime was only paid in 30-minute increments. This means, for example, that 29 minutes of overtime work results in no pay and 58 minutes results in only one unit of overtime pay.
Workers are being paid on time and more than the legal minimums -- but workers say it's not enough "to cover their basic needs."
The FLA writes:
The SCI assessors found that wages are paid on time and are above the applicable legal rates...Sick leave payments are higher than the local law requirement, with workers compensated 70% as opposed to the minimum law requirement of 60%. Overtime hours were also paid at the appropriate premiums...With respect to satisfaction with wages, 64.3% of workers thought that their salary was not sufficient to cover their basic needs.
Foxconn interns fall through the cracks.
Though Foxconn does provide interns with some forms of health insurance, due to Chinese labor laws, interns "are not defined as employees and legally, no employment relationship exists between the factory and the interns."
The FLA adds, "This means that the general protections of the labor law do not apply to interns, including the social security benefits that normal workers receive. While regulations applying to interns exist in Guangdong Province and the Ministry of Education has issued policy regarding interns, their employment status remains vague and represents a major risk."
Migrant workers, who make up a large share of the workers at Foxconn factories, are often unable to claim benefits, such as social security and insurance.
According to the FLA:
Social security, medical and unemployment insurance require contributions from both the employer and the employee. However, migrant workers may not be able to claim those benefits in their hometown if they retire or become unemployed. It all depends on whether the two provinces in question (where they work and where they have residence) have established the institutional mechanisms to transfer the relevant funds....At the Shenzhen facilities only 1% of the workforce are local, while the migrant workers are not enrolled in the unemployment and maternity insurance systems.
Workers don't trust safety conditions at the factories and don't have much of a say in policing (or improving) working conditions.
Workers generally felt "insecure regarding their health and safety," the FLA reports, noting also that Foxconn's safety and health committees are largely populated by individuals with ties to Foxconn management, as managers choose the people who are eligible for election to those committees. These "reactive" committees often "[fail] to monitor conditions in a robust manner" and "[a]s a result, workers remain generally unaware of committees’ existence or role, while factories’ communications are almost entirely top-down."
The FLA additionally writes:
Investigators found that workers were largely alienated, in fact or in perception, from factories’ safety and health committees and had little confidence in the management of health and safety issues. The assessment also suggests that if workers had more involvement with developing and monitoring health and safety procedures, many of the problems with implementation could be avoided.
Workers often work more than the legal limit.
Foxconn workers reported working an average of 56 hours a week and a maximum average of 61 hours a week. Though their hours often exceed legal limits, a third of workers actually said they'd prefer to work more: "When asked in the survey how they feel about working hours, 48% thought that their working hours were reasonable, and another 33.8% stated that they would like to work more hours and make more money. 17.7% of the respondents felt that they worked too much," the FLA writes.
During peak production, the average number of hours worked per week at Foxconn factories exceeded both the FLA Code standard and Chinese legal limits. This was true in all three factories. Further, there were periods during which some employees worked more than seven days in a row without the required minimum 24-hour break. The root causes include high labor turnover, which undermines efficiency, and gaps in production and capacity planning.