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Certification Program Would Force Apple, Others to Make Ethical Gadgets

Lately, Apple has been taking a lot of heat for the harsh working conditions at its suppliers' factories. The same week that Apple announced its record-smashing $46.3 billion-revenue quarter, the New York Times rained on Tim Cook's parade, publishing an article that accused his company of ignoring deadly safety violations at the plants that make its popular products. In the wake of these allegations, some have called for a public boycott or increased oversight, but the sad truth is that Apple is only the most visible offender, not the worst offender.

Users need a better way to find out who made their gadgets and under what conditions so they can vote with their wallets. A voluntary logo program in the style of the current EPEAT environmental ratings would give companies incentive to improve conditions and consumers to do the right thing. Without the right information at their fingertips, it's far too easy for consumers to continue acting as enablers for modern day feudalism. High-profile incidents like the Foxconn suicides and the Chengdu factory explosion are  just the tip of the iceberg, but most consumers wouldn't know it, unless they make a habit of visiting activist websites like China Labor Watch.

Horrifying Conditions

China Labor Watch's (CLW) 136-page report on conditions at 11 different electronics factories, reads like a Charles Dickens novel set in the height of the industrial revolution. The activist group chronicled a smorgasbord of human rights, labor, and safety horrors that should make any human with a conscience think twice about buying any company's smartphones, tablets, or notebooks. 

What if, in order to get a job, you had to promise your employer or one of his head hunters a fee equal to several days or even several months' salary? At a number of Chinese plants, prospective workers have to pay the employer or one of his head hunters a fee equal to several days or even, as in the case of 17 Apple suppliers, several months salary.  The Electronic Industry Citizenship Coalition (EICC) Code of Conduct, which Apple and nearly all of its competitors subscribe to, does not explicitly ban recruitment fees and Apple actually says that suppliers can charge a recruitment fee as high as a full month's salary. 

What do you call it when you work somewhere, don't get paid, and can't even quit because you still owe money to the company or its agents just for letting you in the door? Apple euphemistically terms this practice it "involuntary labor," but let's call it what it is: indentured servitude.

At a lot of plants, workers are not given adequate protective gear, don't have ready access to a first aid kit, and are told that if they get injured that it's their own problem. "The only safety precautions workers are given is a simple explanation of being careful while at work, not to run around, don't move products and wires, and do what the leader instructs," the report says of one plant that makes products for Acer, Apple, ASUS, Dell, IBM, Motorola, Nokia, and Sony.

In addition to potential injury, workers must endure long hours, sometimes 12 hours a day for 30 days without any time off, all for monthly wages that are typically in the $350 range, with some earning as little as $169. During long shifts, many are asked to stand up and perform the same repetitive task (ex:  wiping a phone screen) over and over again, without the ability to take a bathroom break and, in at least one case, permission to talk. Workers who make mistakes face significant verbal abuse, huge fines, and public humiliation by management. Oh, and if workers want to quit, their resignation requests may be rejected by the boss and they'll be forced to walk out of the factory, leaving any outstanding earnings in the employer's pocket. 

Low Standards

Sadly, the industry is not doing nearly enough to deal with these horrors. Most manufacturers post corporate responsibility reports that tout the number of audits they've performed, but few do what Apple does in disclosing the list of violations the company finds. 

Perhaps OEMs are reluctant to show all their cards, because audits don't always provide an accurate picture of working conditions at these factories. According to Li Qiang, the head of China Labor Watch, many factories bribe inspectors to give them favorable ratings. If corruption doesn't work, there's always the old "let's clean up our act just for the inspector's eyes" routine.

Even the standards listed in the EICC code of conduct that OEMs embrace leave something to be desired. For example, the code states that "a work week should not be more than 60 hours per week, including overtime, except in emergency or unusual situations" (whatever those are). 

An EICC case study of HP says the company became concerned by some answers it got from one of its suppliers' self-assessment questionnaires so it initiated an audit, which uncovered one "priority nonconformance." According to the report:

The priority nonconformance was related to worker living conditions—workers’ dormitories at the supplier factory were being locked at night -- which was identified as a priority due to lack of safety for workers when emergency egress is required.

Does it bother anyone that the only problem HP and EICC had with keeping workers locked in their dormitories all night is that they might not be able to get out in the event of a fire? What about their right to freedom of movement?

Realistic Standards

There's plenty of blame to go around for these inhumane and immoral labor conditions. The suppliers who run the factories clearly have a responsibility to keep their employees safe and treat them with dignity, but OEMs are the ones squeezing those suppliers for more production at lower and lower costs. There's no doubt that major manufacturers, such as Apple, could pay the suppliers better and demand better working conditions.

Some say that making a humane smartphone is impossible, given the manufacturers' need to cut costs and the public's desire for cheap gadgets. TechCrunch's Devin Coldewey even writes that "A conflict free iPhone would cost far, far more and would in all likelihood not be as well-built. Apple knows this. The system we and they have in place works, unfortunately, at least for everyone but the workers coated in N-hexane." 

It's not realistic to expect factory workers in China to earn the same $7.25 per hour minimum wage we get in the U.S., but consumers can at least demand that they have a safe working environment that's consistent with basic standards of human dignity and free from serious abuses such as recruiting fees, forced overtime and the inability to resign with pay. 

This isn't rocket science. The two Foxconn plants investigated by CLW both already provide the necessary equipment to their employees even while other suppliers do not.  IHS iSuppli estimates that Apple spends only $8 on manufacturing costs for each iPhone 4S while it spends $188 on components  on a device that retails for $649 without a contract. If the company even paid double that amount--$16 per unit--it would probably make a huge difference for factory workers. 

Logo Program Needed

Unfortunately for consumers with a conscience, there aren't any obvious choices right now. Li Qiang, founder of China Labor Watch, decided to buy an iPhone 4 because Apple suppliers' working conditions were a bit better than others, but still not good.

"Unfortunately I think that there is not a single factory or a single company who is making ethical products right now," he told us. 

What we need is a quick, easy, and trustworthy way for consumers to know that the products they buy are made by suppliers who at least follow the minimal standards set forth by the EICC code. That's where a logo program comes in.

Many of the major OEMs already participate in the EPEAT environmental rating program, which rates their products bronze, silver, gold or non-compliant based on such criteria as energy conservation, recycled materials and packaging. Because vendors want to display the EPEAT rating on their packaging and in their marketing materials, they set their policies to meet these criteria. Then consumers have the opportunity to support EPEAT rated products and avoid those who rank low or don't participate. To ensure compliance, EPEAT employs a verification system based on both self-reporting, and spot checks of both the products and factories where they are made.

In the cosmetics industry, the Coalition for Consumer Information on Cosmetics provides another strong model; the advocacy group will only license its cruelty-free "leaping bunny" logo to companies that submit to independent audits which ensure that they and their suppliers do not test on animals. An independent and trustworthy body would need to conduct frequent inspections of supplier factories while also listening to feedback from the workers and advocacy groups to make sure their audits provide an adequate picture of conditions inside the plants.

However, with a logo program in place, every link in the supply and consumption chain would have an incentive to create a safe and humane manufacturing process. OEMs such as Apple would want to show consumers that they earned the humane-manufacturing logo. Suppliers would need to show the OEMs that they're maintaining EICC standards in order to get the business. And consumers would support the whole process by purchasing products that carry the logo.

Now, someone just has to take the lead. Tim Cook, are you ready? 

Correction: An earlier version of this article incorrectly stated that EPEAT only uses company self-reporting to determine its environmental ratings. In fact, the organization conducts investigations and product spot checks to verify each company's claims.