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Apple Hoards Cash, Makes Products in Abusive Conditions

Apple Hoards Cash, Makes Products in Abusive Conditions


Written by Adele Stan, AFL-CIO

Go to any gathering, and you’ll find nearly every person carrying an iPhone or an iPad, despite the Apple Computer’s dismal record on labor practices. Apple executives must be laughing all the way to the bank — their Swiss bank, that is.

In its fourth quarter earnings report released last week, Apple Computer revealed that 2/3 of its on-hand cash – some $54 billion — is squirreled away outside the boundaries of the United States, presumably to avoid paying its fair share of taxes. In the meantime, reports Students and Scholars Against Corporate Misbehavior (SACOM), a Hong Kong-based group, Apple’s major manufacturing contractors routinely subject employees to forced overtime, wage theft and no breaks — and even unprotected exposure to toxins.

Apple, together with rival tech firm Google, have been lobbying for a “tax holiday” that would allow them to bring some of those billions into the U.S. at a lower tax rate, promising that to do so would create jobs. But, as we reported, a similar measure tried in 2004 created few jobs, and instead rewarded companies that had kept their money overseas. Where Apple has created jobs is in China, where the workers who make its slick products are made to work in deplorable conditions.

A new SACOM report, “The iSlave Behind the iPhone: Foxconn Workers in Central China,” examines conditions at the Apple Computer contractor’s plant since the suicides of nine workers last year made big news. One thing that has changed: workers were given a raise — to all of $1.18 an hour. But workers are often shorted overtime pay, SACOM reports, and Foxconn even illegally withheld, during the Chinese New Year, payment for overtime already worked in order to prevent workers from taking the traditional holiday to visit their families.

Most workers in these factories are migrants; the corporations deliberately build facilities in lower-populated areas where wages are lower. Not that labor costs account for much of the cost of an Apple product. According to Sophia Cheng, writing at the SACOM Web site:

Take the iPad, for example, which is the sole item produced at Foxconn’s 100,000-worker factory in Chengdu. Industry analyst iSuppli estimates that Apple spends only $9 on labor for every $499 iPad.

In SACOM’s latest report — whose release was timed to coincide with the opening of the first Apple Store in opulent Hong Kong — workers complain of deplorable dormitory conditions, where access to electricity and water is routinely cut, and of the exploitative fees they are made to pay to Foxconn for their room and board.

Workers say they are also made to stand for 10 hours at a time without taking breaks, and subjected to abusive behavior by supervisors, including being made to sign confessional letters when accused of making a mistake or infraction. In China, labor unions are run by the state, so when workers act on their own to strike, as they did at United Win, another Apple contractor, in 2010, they risk legal sanction.

Download the full report, The iSlave Behind the iPhone: “Foxconn Workers in Central China,” here in a PDF file.

This post was originally published on the AFL-CIO blog.


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Photo from nicdalic via flickr

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10:55AM PST on Nov 13, 2011

More than a good enough reason to boycott Apple for life! Can people find it in their hearts to be compassionate enough to give up their nifty technology by the evil corporate giant in the name of justice?!? It seems most people refuse begs the question: Is their hope for us???

3:05PM PST on Nov 10, 2011

Oh that's horrible. =( Thanks for sharing. I've always thought Apple produced overpriced yet attractive pieces of technology. Now, that's even more so. It surely is a corporation, ruthless as always.

1:55PM PST on Nov 10, 2011

An absolutely terrible situation. I really believe that Steve Jobs was not the perfect person that many make him out to be.

4:29PM PST on Nov 9, 2011


3:57PM PST on Nov 9, 2011

This story fits perfectly with "74-million-I-pads 26 Suicides did Steve Jobs know?"

Of course the answer is YES! However, where is the Chinese government? If it exists, they WANT IT THAT WAY.

8:09AM PST on Nov 8, 2011

On and on, it's all becoming clearer and clearer thanks in no small part to the Occupy Wall Street movement. If I could encourage the movement to take on one of the many issues defining their efforts, I would encourage the use of the new f- word, fraud.....forever anon. It's all about ending fraud, or at the very least, containing it like we do cockroaches.

4:56PM PST on Nov 6, 2011

Here is a speaker on a program on Australia's ABC called Big Ideas that will be of interest to everyone who would like to see our free enterprise system evolve into a system which recognises fiscal and social responsibility as part of the whole package of a sustainable, global free market. The social networks on the Internet give us individuals a power never before seen to influence the corporate world to reflect what is important to us in their products and their business ethics, or we will not buy those products or use their services.

People around the world are standing up for a world which is a safe, nurturing, caring place for us all. This talk shows us how we can do it. His name is Simon Mainwaring, and the book he has written on the subject is called 'We First'. It's brilliant.

Bill Gates has also written an article featured in Time Magazine which influenced this speaker and his book. If you can get hold of it (maybe Bill has also written a book!) it's a great read.

4:52PM PST on Nov 6, 2011

I don't have an iPod or iPhone, I won't patronise Apple.

4:49PM PST on Nov 6, 2011

Just another example of the "haves" vs the "have nots" and the abuse it intails.

4:31PM PST on Nov 6, 2011

Nitzan M.- the point is, Apple could charge a few dollars more for each product and pay their workers a fair wage, or take a TINY cut in profits- but they choose not to! They KNOW the workers have terrible conditions, and don't care! That uncaring attitude is common in American business, but runs counter to the ideals America was built upon. (Yes, I know the workers are not in this country, but if it's an American company, the workers should still have some human dignity!)

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