Apple Bans Key Supplier Pegatron from New Contracts for Labor Violations

iPhone 12 back

Apple has suspended any new business with Pegatron, one of its key supply chain partners over labor law violations. Apple discovered that Pegatron misclassified student workers and made them work nights and overtime violating the company’s Code of Conduct.

The employees then went to extraordinary lengths to cover up the violations. The company noted that while it did not find any underage labor cases in Pegatron’s factory, it did find the Taiwanese company falsifying documents to hide the violations. Pegatron has already fired the manager who saw the student worker program. The Code of Conduct violations took place in Pegatron’s factory in Shanghai and Kunshan campuses located in eastern China. Students were made to work night shifts, over time, and in positions that were not related to their major thereby violating local laws and regulations.

“Pegatron misclassified the student workers in their program and falsified paperwork to disguise violations of our Code, including allowing students to work nights and/or overtime and in some cases to perform work unrelated to their major,” Apple said in a statement. “The individuals at Pegatron responsible for the violations went to extraordinary lengths to evade our oversight mechanisms.”

Apple has placed Pegatron on probation and won’t be offering it any new business until the latter has taken corrective action.

Apple suppliers have been frequently found violating labor laws, especially during peak iPhone season. Apple has become stricter with its guidelines and in enforcing them in recent years which has led to an improvement in the working conditions of laborers in factories but such lapses show that there’s still a long way to go.

[Via Bloomberg]