Full Text: Pegatron, Apple Respond to China Labor Report

Published July 29, 2013

| FOXBusiness

Pegatron and Apple (AAPL) issued statements on Monday responding to a report from China Labor Watch alleging widespread workers' rights violations at three Pegatron facilities. 

The full text of the statements follow:

Pegatron CEO Jason Cheng

When we started Pegatron five years ago, we had a vision of being a leader in innovative manufacturing and of creating jobs that provide good wages and opportunities to enrich the lives of those who joined our company. We strive to make each day at Pegatron better than the last for our employees. They are the heart of our business. That's why we take these allegations very seriously. We will investigate them fully and take immediate actions to correct any violations to Chinese labor laws and our own code of conduct. In addition to working closely with our customers in meeting their codes of conduct, Pegatron sets very high standards for ourselves with our own dedicated team that audits and investigates issues. In the last two years, we established multiple channels for our employees to directly communicate their needs, issues and aspiration with the company. In addition, Pegatron helps create the educational programs including parenting seminars for pregnant workers, management courses, and accredited higher education classes. Apart from our continuous effort to enhance employees’ skill set, Pegatron also endeavors to improve working environment and facilities for our employees. We know that Pegatron can only be successful with a happy and healthy workforce and will work hard to ensure that we all achieve success together.

Apple, Inc. 

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.

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