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Apple puts iPhone supplier on probation for exploiting student workers

Pegatron misclassified its student workers and allowed them to work nights and unpaid overtime hours

9 Nov 2020

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Apple has placed one of its supply chain partners on probation following reports of student labour violations at some of the manufacturer’s China-based facilities.

Pegatron, which is one of Apple’s biggest suppliers and currently manufacturers some of company's iPhone 12 models, reportedly falsified paperwork in order to cover up violations of Apple’s code of conduct.

Apple told Bloomberg that the Taiwanese manufacturer misclassified its student workers and allowed them to work nights and unpaid overtime hours, as well as “perform work unrelated to their major”.

This is in violation of Apple’s code of conduct for suppliers, which requires that they “ensure the intern’s work is related to their major and prohibits overtime or night shifts”. Consequently, Pegatron also falsified official documents in order to hide the incidents of code violations.

Apple stated that it “has placed Pegatron on probation and Pegatron will not receive any new business from Apple until they complete all of the corrective actions required".

Pegatron released a statement in which it claims that “upon discovery of this non-compliant activity”, it “immediately took the student workers off production lines”.

It also said that it has cooperated with its “customer and third-party experts to make appropriate arrangements for them to return to their homes or schools with proper compensation alongside all necessary support and care”.

The supplier had also fired the manager of its student worker programme but did not disclose how the probation imposed by Apple will impact the company and its financial results.

The incident isn’t Pegatron’s first instance of reported student labour violations. In 2013, China Labor Watch released a report that found the company engaged in cases of unpaid overtime and underpayment of student workers at its Shanghai factory.

The report claims that around 100 student workers “were not paid for 20 to 30 minutes of daily mandatory overtime meetings, had wages deducted, or only received 80 percent of the wages of normal workers despite doing the same work”.

“Many other student workers, who have not yet been reached, likely have suffered the same unfair treatment,” it added.