The upcoming launch of a new initiative commissioned by President Barack Obama could spell trouble for Apple if the technology giant fails to enact policies that protect the rights of its employees around the globe.
Although the policy has not been enacted yet, the initiative is based on an executive order Obama signed last year called “Strengthening Protections Against Trafficking in Persons in Federal Contracts,” which says that if a company wants to keep the government as a customer, that organization cannot sell jobs to vulnerable populations or knowingly engage in any other human rights abuses.
The order was designed to protect the estimated more than 20 million men, women and children who are trafficked around the world. And while it’s being hailed as a win for those fighting against human trafficking, it’s also a challenge for companies who have long supply chains and rely almost exclusively on foreign migrant workers to create their products.
Though less common in the U.S., many labor brokers in Asian countries often charge already impoverished people for a two-year job on a consumer-electronics assembly line. The brokers charge high fees that are often equivalent to at least one year’s wages, and hold the migrants’ passports and papers hostage to ensure they pay their debt.
In an effort to lessen the human rights abuses around the world, many organizations and state laws have begun to encourage companies to ensure human trafficking is not occurring within their organization or that of their suppliers.
As part of Obama’s executive order, the president gave corporations who supply the world’s biggest consumer — the U.S. government — until Dec. 20 to give their input on the new regulations to ensure they could comply with the new rules.
It’s not clear whether Apple has given any input to the Obama administration regarding the rules, as the company has declined to comment on how the new rules could impact its business. And while other technology companies have expressed their concerns about being held responsible for the actions of their suppliers, Apple seems to be completely lax about everything. But should they be?
Though Apple is known for its technology products, the company is actually just the designer of the equipment — it doesn’t actually build any products itself. To build Apple products the company hires other giant companies such as Foxconn and Flextronics International, which own and operate factories in places such as Kuala Lumpur and Malaysia.
Although the factories are located halfway around the world, Apple’s corporate responsibility webpage on labor and human rights issues says that “If companies want to do business with us, they must act fairly and ethically at all times.”
“We don’t allow suppliers to act unethically or in ways that threaten the rights of workers — even when local laws and customs permit such practices,” the company says. “We’re working to end excessive work hours, prohibit unethical hiring policies, and prevent the hiring of underage workers.”
The technology giant says it strictly prohibits bonded labor in its Supplier Code of Conduct, and suppliers who violate this policy “must reimburse excessive recruitment fees — anything higher than the equivalent of one month’s net wages — for any eligible contract worker found working on Apple projects.”
Although Apple says that since 2008 its suppliers have refunded more than $13 million to workers, and nearly half of those payments came in 2012 alone, a report in Businessweek says that audits the company did of its suppliers last year found that suppliers overcharged these enslaved employees by $6.4 million.
The report also pointed out that an employee has to inform Apple that they were charged more than a month’s wages for the job, but since brokers have become aware of this, they now threaten workers in the hopes they don’t talk to anyone at Apple.