Computer giant Apple has become embroiled in a new row over its suppliers after China Labour Watch claimed that Pegatron, one of Apple's outsourced manufacturers in China, was violating local labour regulations.
In a report released today entitled Apple's Unkept Promises, the rights group claims that Pegatron, which makes iPads and iPhones for Apple in factories in China, is forcing staff to work unpaid overtime, and that both their living and working conditions are substandard.
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"The Pegatron factories are violating a great number of international and Chinese laws and standards as well as the standards of Apple's own social responsibility code of conduct," claim the group.
Pegatron has been contracted to produce the budget iPhone, according to the group, and the company is currently gearing up to to make this product, employing more than 70,000 workers to fulfill the contract.
"Workers in Apple's supplier factory Pegatron are monotonously working long overtime hours to turn out a scaled-back, less expensive version of the iPhone. Six days a week, the workers making these phones have to work almost 11-hour shifts, 20 minutes of which is unpaid, and the remainder of which is paid at a rate of $1.50 an hour ($268 per month) before overtime.
"This is less than half the average local monthly income of $764 and far below the basic living wage necessary to live in Shanghai, one of costliest cities in China. So these workers rely on long overtime hours. If a worker does not finish three months at Pegatron, the dispatch company that got the worker hired will deduct a large portion of his wages," claims the report.
It continued: "After a grueling day's work, what a worker has to look forward to is a 12-person dorm room, lining up for a quick cold shower in one of the two dozen showers shared by hundreds of workers.
"At Pegatron, over 10,000 underage and student workers (interns), from 16 to 20 years of age, work in crowded production rooms, doing the same work as formal, adult workers. But some students are paid lower wages because schools deduct fees for the internship, while other students will not have their wages paid to them on time."
In a statement issued to news agency Reuters, Pegatron CEO Jason Cheng promised to investigate the complaints: "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," said Cheng.
Apple, meanwhile, told Reuters that it has conducted 15 audits at Pegatron factories since 2007 as part of its "due diligence" into its supply chain. It said that it will investigate the complaints and demand that underpaid workers are reimbursed.
New York-based China Labor Watch said it sent undercover investigators into three Pegatron factories and conducted nearly 200 interviews with workers outside the factories from March to July.
In separate reports, the group has also criticised Apple's major rival in mobile phones, Samsung.
