NGOs Continue To Document Poor Working Conditions in Chinese Factories

December 19, 2012

In recent months, several international and Hong Kong-based labor NGOs have issued reports documenting labor violations at factories in China producing electronics and other goods for well-known brands such as Apple, Samsung, Mattel, Motorola, LG, Disney, McDonald's, and Hasbro. In some cases, reports continue to document poor working conditions at factories previously cited for violations. The reports highlight the lack of enforcement of Chinese labor laws and the absence of effective mechanisms to advocate on behalf of Chinese workers.

Conflicting Accounts of Labor Improvements at Foxconn

In August 2012, the Fair Labor Association (FLA) issued a report (August Report) following up on a March 2012 FLA investigation (March Investigation) of three Foxconn factories in Guangdong and Sichuan provinces. Foxconn, a Taiwanese electronics manufacturer which produces electronic products for major brands such as Apple, HP, Nokia, and Dell, previously agreed with Apple to implement a range of reforms to address labor violations documented in FLA's March investigation, including reducing overtime while protecting workers' pay, paying workers for overtime and work-related meetings outside regular working hours, ensuring interns "enjoy the protections necessary for a productive, healthy and safe educational experience," and enhancing worker involvement in committees and unions by ensuring "nominations and elections take place without management involvement" (March Investigation, pp. 12–13). In the August Report, FLA indicated "that necessary changes, including immediate health and safety measures, had been made," concluding that, "all remediation items due within the timeframe have been completed, with others ahead of schedule."

Observers have questioned the findings in FLA's August Report, asserting that poor working conditions continued to exist in these factories. In an August 23, 2012, Oriental Morning Post article, Beijing University Professor Lu Huilin criticized FLA's report for neglecting to report on problems related to management abuse and the use of dispatch labor, or subcontracted workers who often receive lower wages and have less job security than regular factory employees. Lu also raised concerns with the relationship between FLA and Apple, questioning the objectivity and independence of FLA's investigation. A November 8, 2012, report released by the Washington DC-based Economic Policy Institute found that "in contrast to the FLA's glowing assessment, improvements in working conditions at Foxconn have in most cases been modest, fleeting, or purely symbolic, while some key reform pledges have been broken outright."

Reports issued by labor NGOs in September and October 2012 documented additional labor violations at other Foxconn factories throughout China. On September 20, 2012, Hong Kong-based Students & Scholars Against Corporate Misbehavior (SACOM) issued a report following up on investigations conducted in April and May 2012 at three Foxconn plants in Zhengzhou city, Henan province. Their investigation, conducted in September 2012, found that workers continue to face "deplorably harsh working conditions," including excessive overtime of up to 100 hours per month, far exceeding the legal limit of 36 (see Article 41 of the PRC Labor Law), exploitative use of student intern and dispatch labor, inadequate training and protection from occupational injury, and abusive management practices requiring workers to obtain permits to go to the bathroom. On October 15, 2012, New York-based China Labor Watch (CLW) reported that interns as young as 14 were found working at a Foxconn plant in Shandong province. Articles published by China National Radio (15 October 12) and Beijing Times (16 October 12) also reported finding interns under the age of 16 working at this plant and an October 17, 2012, South China Morning Post article, quoted a statement released by Foxconn confirming these allegations. A spokesman for the Ministry of Human Resources and Social Insurance pledged at an October 25, 2012, news conference to "resolutely put an end to the abuse of student workers,"when asked about the recent Foxconn allegations, however, labor NGOs continue to document the overuse of student workers in Chinese factories (See CLW, 4 September 12 and SACOM, 23 October 12 reports discussed below).

Labor Violations Found Throughout Electronics Industry

On September 4, 2012, CLW issued a report (September 4 Report) on working conditions at eight Samsung supplier factories, six of which are directly operated by Samsung, in Shandong, Guangdong, and Jiangsu provinces, and Tianjin municipality. The report, compiled from May to August 2012, found "the treatment of Samsung's Chinese factory workers is far from model." The investigation uncovered "an array of serious legal violations and labor abuses throughout these 8 factories," including excessive overtime, exhausting labor conditions requiring most workers to stand for the entirety of their shift, abuse of student workers and dispatch labor, harsh working conditions, extensive labor contract violations, abusive management practices, and discriminatory hiring practices.

Following release of the report, Samsung announced plans to investigate its Chinese suppliers for possible labor violations (CBS News, 4 September 12). On November 26, 2012, Samsung released a statement on its Web site affirming that its investigation had "identified several instances of inadequate practices at the facilities," including excessive overtime in violation of local laws, labor contract violations, and arbitrary fining of workers for lateness or absences. Samsung proposed a number of "corrective actions to address every violation that was identified," including new hiring policies, work hour and overtime practices, and other measures to improve health and wellbeing of workers.

On November 26, 2012, CLW issued a report following up on the findings documented in the September 4 Report. The follow-up report, compiled from October to November 2012, of five Samsung supplier factories, two of which were previously investigated in the September 4 Report, found that many of the labor violations previously uncovered continued unabated, concluding that "Samsung had made no improvement" since the publication of CLW's September 4 report.

On October 23, 2012, SACOM issued a report on Apple supplier Riteng Computer Accessory Co, Ltd., a maker of the iPad mini. The report covers the results of SACOM's investigation of Riteng's Shanghai factory, conducted in October 2012, which found widespread labor rights abuses, including excessive overtime of up to 200 hours per month, unpaid overtime, abuse of student interns and dispatch labor, and exposure to hazardous materials without proper safety equipment.

Labor Violations in Toy Industry

On November 29, 2012, CLW issued a report on working conditions at four Mattel factories in Guangdong province. The investigation of one directly owned Mattel factory and three contracted supplier factories, which also manufactured products for Disney, McDonald's, and Hasbro, found that all four factories "were riddled with legal and ethical violations." According to the report, workers were subject to inadequate training and protection from occupational injury, excessive overtime, hazardous living and working conditions, overuse of contract labor, and failure to provide insurance in accordance with legal requirements. The report found that despite previous evidence of labor violations documented by third-party auditors, all four factories had received a "seal of compliance" from Mattel.

Additional Commission Analysis

The regularity and consistency of the labor violations cited throughout these reports and previously documented by the Commission (See CECC, 24 July 12) suggests many of these problems are systemic throughout China's manufacturing industries. On July 31, 2012, the Commission held a hearing on working conditions and worker rights at which witnesses addressed the prevalence of harsh working conditions and the implementation of labor laws in China (online transcripts of witness testimony and video of the hearing are available here). For more information on China's labor laws and other issues relating to worker rights, please see Section II—Worker Rights in the Congressional-Executive Commission on China 2012 Annual Report.