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Latest audit on two Chinese Apple suppliers finds labor, health violations

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Apple says it's made "meaningful improvements" since the 2013 inspections.

Apple

A new report from the Fair Labor Association (FLA) on two facilities run by of one of Apple's manufacturing partners has found numerous violations, including excessive overtime, underpayment of sick wages, and inadequate health and safety measures. Those issues have been flagged at other factories in Apple's supply chain over the years, including Foxconn, which was not the focus of this report.

The two factories in question are operated by Quanta, and were located in Shanghai and Changshu, both in Eastern China. The facilities were inspected by third-party labor monitoring organization Openview Service on behalf of the FLA last August, all as part of a larger and continual inspection on Apple's supply chain.

More workers were "unaware" if they were in unions

According to the two reports, the majority of the violations were categorized under "employment relationship," a category that covers things like recruitment practices, documentation and inspection, and policies for health and safety. The FLA also found issues with freedom of association, with 80 percent of workers in both factories "unaware whether they were union members," or not. And while there were existing health and safety policies, the FLA said it found issues with indoor air testing in both facilities, improper storage of flammable and toxic substances in Shanghai, and no employees involved with health and safety committees.

In a statement, Apple said it detailed some of the issues in its 2014 supplier responsibility report back in February, and has audited the sites as recently as last month:

Our suppliers must live up to the toughest standards in the industry if they want to keep doing business with Apple, which is the first and only technology company to be admitted to the Fair Labor Association. We are committed to providing safe and fair working conditions for everyone in our supply chain.

Last year we conducted 451 comprehensive, in-person audits deep into our supply chain so we could uncover problems and work with our suppliers to fix them. We track and report the weekly working hours for more than 1 million workers, and our 18-month Apple Supplier EHS Academy training program is raising the bar for environment, health and safety management in the industry.

The Quanta facilities inspected by the FLA last year were included in our 2014 Supplier Responsibility report, which we released in February. Our own experts have audited these sites 16 times, most recently last month.

In the year since the FLA's visit, we have worked closely with Quanta to drive meaningful improvements in areas identified by both the FLA and Apple. Apple conducted four follow-up inspections on top of the annual audits of both facilities, to ensure the needed corrections are in place.

This year, through the end of July, Quanta has averaged 86 percent compliance with our 60-hour workweek. Excessive overtime is not in anyone's best interest, and we will continue to work closely with Quanta and our other suppliers to prevent it.

Quanta is reportedly putting together the iWatch

Quanta's traditionally acted as a final assembler for Apple products, and has been tapped for things like the iPad. A more recent report said Quanta was putting together Apple's much-rumored smartwatch. In this case, the Shanghai facility is the larger of the two with 31,706 workers, while the Changshu site has 4,711 workers. As part of the assessments, the FLA says that it interviewed 389 workers in Shanghai, and 132 in Changshu over a nine day period, with most of those interviews occurring on-site.

Apple joined the FLA in January 2012 as an addition to its usual annual supplier responsibility reports and after heavy media scrutiny on overseas labor. The third-party group investigates suppliers and manufacturing facilities for potential violations of health and safety, and also interviews workers. The deal between the FLA and Apple lets the group inspect the tech company's supply chain, and requires it to make changes as part of a remediation policy.