Apple and its manufacturing contractor Foxconn admitted to breaking Chinese labor regulations by the excessive use of temporary staff in the world’s largest iPhone factory, according to Bloomberg. The accusation came in a report by non-profit advocacy group China Labor Watch (CLW), which also said that Apple’s Taiwanese manufacturer subjected staff to other illegal and harsh working conditions.

Why it’s important: This is not the first time Foxconn, China’s largest private sector employer, has broken Chinese labor laws. Last month, Foxconn fired two executives after another CLW report found that temporary staff and underage interns making Amazon Echo speakers exceeded the legal limit in its Hengyang factory in central Hunan Province.

  • Apple has sought to mitigate poor labor standards in some of its vendors by pressuring them to change their practices or face losing contracts with the Silicon Valley giant, as well as with an annual responsibility report on its supply chain.

Details: For its report, CLW claims it sent undercover investigators to Foxconn’s Zhengzhou plant in central China, including one who worked there for four years. At the world’s largest iPhone factory, CLW found that around 50% of the workforce in August was made up of temporary staff, including interns who were in high school. Chinese law stipulates that only 10% of a factory’s plant should be temporary.

  • The report said that last year, 55% of the workforce were dispatch workers including student interns, compared with 50% this August. The number now is around 30%, as teenage interns are returning to school.
  • Apple sent an investigator to the factory to examine findings in August, but did not stop manufacturing activity despite the violation, the CLW said on Sunday.
  • On Monday, Apple told Bloomberg that it is “working closely with Foxconn to resolve this issue” and that it will “take immediate corrective action” after finishing an operational review. It added that less than 1% of workers were teenage interns.
  • Apple denied other allegations in the report, Bloomberg reported. CLW claimed that during peak production periods, resignations are not approved, some temporary staff have not received promised bonus payments, student interns work overtime—prohibited under Chinese law, workers stay overnight for unpaid meetings, and work injuries are unreported.
  • The advocacy group also said that student interns work busy periods, with some working 100 overtime hours per month, far exceeding the legal limit of 36 overtime hours monthly.
  • Foxconn found “evidence that the use of dispatch workers and the number of hours of overtime work carried out by employees, which we have confirmed was always voluntary, was not consistent with company guidelines,” Bloomberg reported.

Context: CLW published the report ahead of Apple’s iPhone release which will take place Tuesday morning in the US. Foxconn hires thousands of temporary staff every year during key moments of the year to meet demand.

  • Foxconn’s labor standards have been under scrutiny for many years, which then extends to the tech companies that buy from the Taiwanese manufacturer.
  • In 2011, an explosion in a Foxconn factory in Chengdu serving Apple, Samsung, and Microsoft led to three deaths and 15 injuries. The next year, pictures of suicide-prevention nets in a Guangdong plant went viral.

Eliza was TechNode's blockchain and fintech reporter until July 2021, when she moved to CoinDesk to cover crypto in Asia. Get in touch with her via email or Twitter.

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