Apple Manufacturing Facilities Under Scrutiny for Labor Conditions

By Tech Wire Asia | 15 February, 2012

Apple has been under fire for its suppliers’ alleged bad labor practices. Amid an audit of key China-based suppliers and manufacturing plants, Apple is adamant at its stand that it “takes working conditions seriously.”

Foxconn's manufacturing facilities in China have been marred with suicides and explosions the past couple of years, although Apple and other firms swear by their Chinese plants' efficiency. (AP)

Apple CEO Tim Cook stresses that the company has been monitoring labor conditions “for a long time,” speaking at an interview at the Goldman Sachs Technology and Internet Conference in San Francisco earlier this week, reports AFP. This was in response to criticisms by labor watchdog Fair Labor Association, particularly after reports that the company’s suppliers and manufacturing plants in China were run with poor labor conditions.

Taiwan-owned Foxconn — among other Apple suppliers — has oft been criticized for employing overworked and underpaid labor, reportedly having workers clock in 60 hours per week. Underage labor is also a concern.

Apple has even started micromanaging schedules to help avoid excessive working hours. “We are constantly auditing facilities looking for problems, finding problems and fixing problems, and we report everything because we think transparency is incredibly important,” Cook says.

Stellar Performance

Amid these criticisms, Apple continues to perform well as a business. The company has had a “decent quarter,” with shares soaring past US$ 500 each this week, and closing at a high of US$ 509.46. The company’s quarterly earnings were reported to be at US$ 13.06 billion (double the same quarter the previous year), and an all-time high revenue of US$ 46.33 billion.

But even with stellar performance, Apple’s chief executive says the corporate board is still discussing whether to divest its cash reserve as dividends, or to buy back shares. Apple is sitting on US$ 98 billion in cash.

When asked about what Cook wanted to be his legacy with Apple, he said he wanted to maintain co-founder and former CEO Steve Jobs’ formula. “Apple is this unique company, unique culture that you can’t replicate,” he said. “I’m not going to witness or permit the slow undoing of it.” Perhaps Apple is hoping that allegations of running sweatshops and a possible iPad ban in China will not contribute to its undoing.