China Labor Watch alleges labor abuses at Apple supplier Pegatron in China

“A new report from a Chinese workers-rights group alleges labor abuses at a major Apple Inc. contractor the company has been using more as it shifts some work from longtime supplier Foxconn,” Paul Mozur, Chao Deng, and Eva Dou report for The Wall Street Journal.

“The report, set to be released on Monday by New York-based nonprofit China Labor Watch, alleges safety and environmental violations; the withholding of worker pay or the identification cards they need to work elsewhere; and poor living conditions at China-based factories owned by Taiwan’s Pegatron Corp and two subsidiaries,” Mozur, Deng, and Dou report. “Such breaches would violate both Chinese law and Apple’s supplier policy, and would show the extent of the challenge for Apple to uphold the relatively high labor standards it has set in a Chinese electronics-supply chain where breaches in labor law are common.”

Mozur, Deng, and Dou report, “Pegatron Chief Executive Jason Cheng said, ‘We will investigate [the allegations] fully and take immediate actions to correct any violations to Chinese labor laws and our own code of conduct.’ Pegatron previously has managed to avoid major scrutiny of its factory conditions due to its smaller scale, but the company is growing quickly. Analysts estimate its factory in the Pudong district across the river from downtown Shanghai produces one-third of the world’s iPhones and iPads. Amid a surge in orders, Pegatron expanded its workforce from 50,000 in March to about 70,000 now.”

Read more in the full article here.

MacDailyNews Note: Apple Inc. has released response. Here it is, verbatim:

Apple is committed to providing safe and fair working conditions throughout our supply chain. We lead the industry with far-reaching and specialized audits, the most transparent reporting and educational programs that enrich the lives of workers who make our products. Apple is the first and only technology company to be admitted to the Fair Labor Association, and we are dedicated to protecting every worker in our supply chain.

As a part of our extensive Supplier Responsibility program, Apple has conducted 15 comprehensive audits at Pegatron facilities since 2007, covering more than 130,000 workers making Apple products including annual audits of Pegatron’s final assembly locations and surprise audits at both RiTeng and AVY within the past 18 months.

Additionally, we have closely tracked working hours at all of these facilities. Our most recent survey in June found that Pegatron employees making Apple products worked 46 hours per week on average. Excessive overtime is not in anyone’s best interest, and we work closely with our suppliers to prevent it. Apple surveys working hours for more than 1 million employees across our supply chain each month and we report the findings on our website.

We have been in close contact with China Labor Watch for several months, investigating issues they’ve raised and sharing our findings. When they first told us that workers’ ID cards were being withheld, an auditor from our Supplier Responsibility program was on site the next day to investigate. We confirmed that labor brokers for Pegatron were holding a small number of IDs as they helped set up bank accounts for those employees. We demanded Pegatron put a stop to this practice and a new system was in place within a week.

Their latest report contains claims that are new to us and we will investigate them immediately. Our audit teams will return to Pegatron, RiTeng and AVY for special inspections this week. If our audits find that workers have been underpaid or denied compensation for any time they’ve worked, we will require that Pegatron reimburse them in full.

Our audits involve a thorough review of timecards and other documents to guard against falsification. We will investigate these new claims thoroughly, ensure that corrective actions are taken where needed and report any violations of our code of conduct. We will not tolerate deviations from our code.

Apple believes in transparency and accountability, both for our suppliers and ourselves. We realize being a leader in workers rights and being transparent with our findings opens us to criticism, but we believe strongly that we can make a big difference in the lives of millions of people by doing so and this provides us the courage and resilience to continue the journey. We are proud of the work we do with our suppliers to uncover problems and improve conditions for workers. By vigorously enforcing our supplier code of conduct, we ensure that our suppliers follow the same principles and values we hold true.

MacDailyNews Take: Like herding cats.

Related articles:
Polycarbonate Apple iPhone confirmed in Pegatron labor abuses report – July 29, 2013
Purported low-cost iPhone image appears with FCC certification on polycarbonate case – July 26, 2013
Apple to discontinue iPhone 5 with launch of iPhone 5S and low-cost polycarbonate models, report claims – July 24, 2013
Apple’s low-cost polycarbonate iPhone compared to other iPhones, iPod touch (with video) – July 24, 2013
Latest purported ‘iPhone Lite’ polycarbonate rear casings show different colors (with photo) – July 10, 2013

Apple fires supplier over child labor violations – January 25, 2013
Child labor again found at Samsung phone assembly plant in China – December 15, 2012
Samsung enjoys record profits while employing child labor – October 7, 2012
Samsung accused of ‘serious legal violations and labor abuses’ in China – October 4, 2012
Fair Labor Association releases Foxconn report; looks to correct overtime, safety issues – March 29, 2012


  1. I’m here in the good old US and I’d love to have 46 hours a week for pay. Some people WELCOME overtime. I don’t think it should always be a negative. If you have no kids or the kids are older teenagers and you want overtime, that should be left up to the employee to decide. 46 hours is not much more work. I’ve pulled three 70 to 80 hour work weeks in a row when I was heavily in tech support and we had to do massive computer changeovers when people were not in the office (worked evenings and weekends plus had to be there during the day for regular support) and I was SALARY. So didn’t see a dime extra in my paycheck. That is far more more robbery than this situation.

  2. If anyone took the time to look at Pegatron’s background, they could easily find out that Pegatron supplies components for many, many other companies other than Apple. I’m willing to bet that Apple is their major client only for a small part of the entire year. Nowhere in that article stated there were other companies who could easily share the blame of whatever abuses were taking place. I really don’t quite see how Apple is at fault since it’s a Chinese factory subject to their labor laws. Pegatron produces motherboards, cable modems, set-top boxes, TVs and any number of non-Apple related items, so to use Apple’s name is merely grandstanding for attention. This article is going to be repeated endlessly by the news media and it’s just another case where Apple gets exclusive bad press it doesn’t really deserve.

  3. I wonder: What are the labor standards of the suppliers of EVERY OTHER COMPANY on the planet?

    Hey world: Most labor abuses are occurring at suppliers to companies OTHER than Apple. There are other companies in the world, and most of them do NOT have Apple’s high goals, standards and ideals by any stretch of the imagination. Maybe it would be useful to badger THEM as well.

    IOW: Wake TFU already.

  4. Here we go again. A quick wiki search shows Pegatron contracts for everyone, including Samsung and the new Nexus 7. I guess that doesn’t bring page hits though.

  5. Pegatron has been building stuff for the longest time before Apple. So why weren’t China Labour Watch interested then, and if they were why didn’t the press report about it?

    Pegatron was the subsidiary of Asus computer (the PC guys)

    Labour groups (just like Environmental groups) like hitting Apple as it gives them publicity (which helps in their fund raising. MONEY is the most important thing in any organization ), likewise news agencies like whacking Apple to get page hits.

    Does anybody believe NO PROFIT cheapo PCs and Android devices were built in paradise factories? But criticizing them gives labour groups no publicity and helps then none in fund raising.

    if we believe the apple hater stats android controls 80% of the market and Windows PCs 90% of the PC market: i.e the VAST BULK of SUFFERING WORKERS have to be working in ANDROID and PC factories : yet FEW labour investigations. i.e labour groups prefer ‘helping’ the smaller group of apple workers yet allow the vast others, the millions in PC, android factories to languish… So are they really interested in ‘helping’ workers or are they just fund raising (by attacking apple)?

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