Apple hit by supplier bad practice revelations

Apple has admitted in a new report that the company used three suppliers in the past year that had hired underage workers.

The Supplier Responsibility 2010 Progress Report (PDF) acknowledges that Apple's suppliers had 11 underage workers on their books, and that others had improperly disposed of hazardous waste.

"Apple is committed to ensuring the highest standards of social responsibility wherever our products are made," said the report.

"We insist that our suppliers provide safe working conditions, treat workers with dignity and respect, and use environmentally responsible manufacturing processes."

Apple examined over 100 of its suppliers in 2009, claiming that it helps to educate the companies on good employment policies, and works with local governments to ensure the best conditions for workers.

One of the vendor's recent successes was to stop workers being exploited through the paying of fees to worker agencies.

"As a result of our audits and corrective actions, foreign workers have been reimbursed US$22.2m in recruitment fee overcharges. In 2009, we initiated two proactive strategies: collaborating with government agencies, and co-founding a cross-industry focus group to educate our suppliers on solutions that address their challenges," the report said.

The report cites an example in China when Apple found that a supplier was paying less than the minimum wage and made the company reimburse its workers.

The company had also "identified three facilities that had previously hired 15 year-old workers in countries where the minimum age for employment is 16", and "discovered three facilities that had hired non-certified hazardous waste disposal companies".

Other suppliers had falsified documents and exploited the auditing process, according to the report.

"In one instance, Apple's 2008 audit revealed falsified records for working hours and days of rest. When Apple returned in 2009 for a core violation, the facility again falsified records, presenting worker timecards, daily production output records and quality control records that indicated no violations related to working hours or days of rest," the report said.

"When Apple investigated we uncovered additional records and conducted worker interviews that revealed excessive working hours and seven days of continuous work."

Excessive working hours is a recurring problem with Apple's suppliers, and almost half had exceeded local work-hour limits.

"At 60 facilities we found records indicating that workers had exceeded weekly work-hour limits more than 50 per cent of the time," the report said.

"Similarly, at 65 facilities, more than half of the records we reviewed indicated that workers had worked more than six consecutive days at least once a month."

A total of 48 suppliers had failed correctly to work out overtime payments, and a quarter had accounting systems so beguiling that accurate payroll details were almost impossible to determine.

The report identified "15 facilities where the pay structure was unnecessarily complex and could result in underpayment of wages", said Apple.

Apple found 57 firms failing to offer acceptable employee benefits, such as sick pay and maternity leave, while 49 failed to provide staff with the necessary health and safety equipment.

Apple was heavily criticised last month for rejecting calls to publish a corporate responsibility report.