Do Apple, Microsoft, Sony And Nintendo Really Care? Do We?

For Westerners, the conditions are shocking. Workers slave away for hours on end, pulling overtime, until their legs swell or they suffer from crippling disabilities.

Our iPhones and game electronics are made by hand, probably because it's cheaper to pay a worker in China to fit, solder and polish products than it would be to create a robot dedicated to the task. Moreover, that steady stream of redesigns would be costly -- or impossible.

Yet, it's not just the cheap wages. It's the tiny dormitories stuffed with people, the cameras tracking their every moment, a government that imprisons people for joining unions, and, according to the New York Times, banners in the factories that read, "Work hard on the job today or work hard to find a job tomorrow."

Former Apple supply manager Jennifer Rigoni asked the New York Times, "What US plant can find 3000 people overnight and convince them to live in dorms?"

Foxconn runs an entire ecosystem that's designed with one purpose in mind: make electronics quickly and cheaply for foreign clients like Apple, Microsoft, Sony and Nintendo for you and me to buy. Your iPhone, your Wii, your Xbox 360 and your PS3 are all made at Foxconn factories. But do these foreign clients really care? Do you?

With the increased focus on Foxconn and its work practices, its foreign clients, the Apples of the world, are becoming more open about their relationship with their suppliers.

Apple released a detailed report earlier this month (viewable here) in which the company openly discussed working conditions and its on site audits. Nintendo and Microsoft have corporate responsibility statements of their own (viewable here and here). However, as this recent New York Times article underscores, Apple has gotten most of the attention and public outcry regarding work conditions at Foxconn's plants. This is due to several incidents on Foxconn's Apple product lines, including an explosion that killed two.

The explosion was caused by aluminium dust, inadequate protection and poor ventilation. One activist group, Students and Scholars Against Corporate Misbehavior, videotaped Foxconn workers covered in aluminium dust, the New York Times reported, and sent a copy to Apple. "There was no response," said the group's Debby Chan Sze Wan. "A few months later I went to Cupertino, and went into the Apple lobby, but no one would meet with me. I've never heard from anyone from Apple at all." The explosion, later blamed on aluminium dust build up, killed two and injured at least 16 others. Foxconn later replaced the ventilation at this factory.

"Workers' welfare has nothing to do with their interests."

"Apple never cared about anything other than increasing product quality and decreasing production cost," Li Mingqi told the New York Times. Mingqi is a former Foxconn manager who worked at this plant who is currently suing Foxconn over unfair dismissal. "Workers' welfare has nothing to do with their interests."

One former Apple executive said that Apple has known about the labour abuses for years -- and that they're still going on.

The people running these companies are not heartless monsters. Once, an insider at a major electronics company once told me that they do care -- that the moment people began jumping off en massé from Foxconn factory rooftops, a team was on a plane to China to figure out what exactly was happening. I do believe that they care. They also care about their bottom line and staying in business. Why give up a 20 per cent margin to make products in a country with labour laws and decent wages when China is so inviting, so accommodating? Try calling an American factory at midnight to revamp your iPhone 4 screens.

There are other stories, stories of underage workers, and stories of workers becoming injured and disfigured while making Apple products. Apple, in its recent suppliers report, stated it was auditing factories. Yet, as the New York Times pointed out, half of the suppliers Apple audited continue to violate the code of conduct every single year. And Apple continues to do business with these companies.

And so does Nintendo. And so does Microsoft. And so does Sony. And so does a whole bunch of companies. If Apple is being this open about its suppliers and how it is addressing work infractions, imagine how bad conditions at on the other supply lines.

"You're forcing them to cut safety."

The reason why many of these infractions, the health hazards and the gruelling overtime, take place is due to zero oversight and foreign clients trying to award contracts on the slimmest profit margins. "You can set all the rules you want, but they're meaningless if you don't give suppliers enough profit to treat workers well," a former Apple exec told the New York Times. "If you squeeze margins, you're forcing them to cut safety." Making the iPhone in the US, in comparison, would add $US65 to each phone. I'd pay that, but then again, nobody's ever asked me if I wouldn't. However, somebody probably did ask the corporate boards running these companies.

With China's wages rising and the costs of business going up, the country is increasingly becoming a less attractive place to do business. But for electronics companies, the treadmill to hell Foxconn offers makes it possible to churn out product after product, year after year.

"You can either manufacture in comfortable, worker-friendly factories, or you can reinvent the product every year, and make it better and faster and cheaper, which requires factories that seem harsh by American standards," a current Apple executive told the New York Times. "And right now, customers care more about a new iPhone than working conditions in China."

For those on the outside, China is just some place that's stamped on everything produced. Those workers are anonymous and faceless, separated by culture and language. They are the other, and this is slave labour. Apple, Microsoft, Sony and Nintendo are slave owners. So am I. And, if you own any of their products, so are you.

When a hundred workers on the Xbox line threatened to commit mass suicide over a contract dispute, Microsoft issued this statement to Kotaku: "Due to regular production adjustments, Foxconn offered the workers the option of being transferred to alternative production lines or resigning and receiving all salary and bonuses due, according to length of service. After the protest, the majority of workers chose to return to work. A smaller portion of those employees elected to resign."

What happened to those workers? Are they actually back on the job?

What happened to those workers? Did they get mental health checks? Are they actually back on the job, only weeks after threatening suicide? Microsoft's first Supplier Standard is "Fair wages and health benefits"; are these workers getting mental health disability? If a hundred workers at Microsoft's Redmond headquarters, imagine the outcry. In China, these are just factory workers. They're nameless. They can be replaced. Who cares, right?

These companies shipped jobs to China, but they didn't include the same standards they have for employees back home. Why should they? This isn't their company. It's just a supplier. This isn't their country. It's just some place with lax labour laws. These aren't their employees. They're just nameless workers. Or as Foxconn chairman Terry Gou said, "animals".

We're all to blame, but some of us more so. Way more so.

Top photo: Kin Cheung/AP

Comments

    The phrase "out of sight, out of mind" comes to mind. While it is a concerning issue, almost no-one in the general public knows what goes on in these factories because it is never reported about in the media.

      'The phrase “out of sight, out of mind” comes to mind. While it is a concerning issue, almost no-one in the general public knows what goes on in (the real world) because it is never reported about in the media.'

      Fixed that for ya.

    This wasn't new news when Naomi Klein wrote No Logo in the 1990's. Alas, it will still come as a surprise to some to find the extent to which overseas workers manufacturing luxury goods are exploited.

    I've always wondered, and I'm sure this is going to sound awful but it's sort of just me coming up with a stupid idea: Australia, and surely America by extension, has a huge homeless population. Now, not that they're all unemployed, but surely there's a chunk of them that would be /happy/ to have a dorm to sleep in and a weekly wage? I'm not suggesting we pass a law that forces them to move into camps, but couldn't you make the offer? And eventually they could earn some money and get back on their feet, which is better for the entire community. I don't know. It sounds more horrible when you write it down, to be honest.

      Yes, but...

      The reason a system like this doesn't exist is that it's rife with potential for abuse. A downtrodden person has no bargaining power and could/WOULD be exploited horribly, undercutting wages and conditions - but for the existence of a minimum standards safety net, like we have in Australia.

      What needs to happen is to raise standards elsewhere, not drop them here. Once it becomes more expensive to employ overseas slaves, companies will naturally return home to set up their factories.

        yeah but that minimum wage is killing our manufacturing industry. It's now way to expensive to get things done here without major government subsidies. Unions are killing of the work for their own employees by demanding such high pay rates for mostly low skilled workers. if you did hire them it wouldnt really undercut any thing since almost everything is manufactured overseas these days and if it isn't its damn expensive.

          Even if wages were $3 a hour they couldn't compete. The safety compliance costs and taxes here is what drives people offshore.

      Problem is, a lot of homeless people are useless in that they have no relavant skills, don't want to work or are mentally instable.

        Even so, how is that worse than leaving them homeless?

          Gah, that was supposed to be a reply to Shane. How can I click one button, and have it register as a different one?

            It's Kotaku design flaw, sometimes the buttons under the comment look like they belong to the comment above it. This only happens in 'comment threads' because their is no line the differentiates the comments.

            Keep in mind the reply button is always adjacent from the name (even though you shouldn't have to lol)

      Minimum wage is the problem, who is going to hire someone who is worth less then $14 an hour? (or whatever it is).

      But of course, Silent Wolf is correct in saying that some are 'mentally unstable'.

    It's also the people that run the factories, exploiting their countrymen for their own benefits that are at fault. They want to be successful and have to compete with each other (other factory owners/operators) to deliver the most goods at the cheapest prices and have no problem sacrificing the condition for workers to cut costs.

    Just as the situations in third world countries seem almost impossible to someone (like me) who lives in australia, it's not just the people who create the need for a supply and demand chain in electronics, oil, diamonds ie the big companies who control the flow of these resources, it's the people in positions of power in those countries that aren't passing on the benefits and profits to the people.

    We the consumers are at fault to an extent, for somewhat fuelling the supply and demand cycle but not nearly as much as the companies/governments creating that demand in the first place and the factories/governments perpetrating it.

    Oh look at you all... so might, so much better then everyone. You all act like it all happens by magic.

    Where would these people be working if they didn't have jobs? They choose to work their because they would starve without it, it's not slavery.

    If they want to fight for better living, then power to them. But I don't need to invest my time worrying about the willing. Specially when they are men (and women) who are just as much as responsible for their own situation.

      Are you kidding? The problem here is that they are not responsible for their situation, as there are very few options. People working in slave like conditions to avoid starving hardly comes across as "willing".

        Pfft, Do you have anything made in China?

        Also it is 'willing' how are they being forced to work those jobs? Explain.

          When there are only two options: starve to death or work in conditions such as these, the will to survive prevails, it's not forced labour, but it's almost a form of extortion. The fact that there are only two options isn't the worker's fault, it's the fault of those perpetrating the system that enforces such a structure. The factory owners/operators, the companies that employ these factories are the ones ho have the power to dictate the social situation to those with less money and power.

          Asking someone if they have anything made in china is irrelevant anyway, most of the things that we have (yes we, myself included) aren't made anywhere else EXCEPT for china, as that's where it's cheapest to manufacture because of the reasons i mentioned above. I'm not about to live in a cave and make my own shoes either.

          We can help disrupt the chain of supply and demand which fuels these conditions by supporting locally and ethically made goods, which is what i try to do when i can, but it's just not possible 100% of the time.

            "it’s not forced labour, but it’s almost a form of extortion"

            Thank-you for answering it's not forced labor. And that it's not extortion. If I almost killed someones, that doesn't mean i killed them.

            "power to dictate the social situation to those with less money and power."
            Asking someone if they have anything made in china is irrelevant anyway, most of the things that we have (yes we, myself included) aren’t made anywhere else EXCEPT for china, as that’s where it’s cheapest to manufacture because of the reasons i mentioned above. I’m not about to live in a cave and make my own shoes either.

            "Asking someone if they have anything made in china is irrelevant anyway, most of the things that we have (yes we, myself included) aren’t made anywhere else EXCEPT for china, as that’s where it’s cheapest to manufacture because of the reasons i mentioned above. I’m not about to live in a cave and make my own shoes either." Bullshit, if you buy anything from china, you are advocating it. You can't go around and force other people to do what you think is right when you yourself aren't even doing it!

            Sorry I meant to say here:
            “power to dictate the social situation to those with less money and power.”
            Companies don't have the power to dictate the social situation. All they can do is offer... people are the ones who choose to accept.

            The only way a company could dictate the social situation is to destroy what people already have so they can offer them less... but that act in it's self (destroying another persons property) is criminal.

              HH - I can't believe the drivel you are spouting here. As Shane mentions above, I suggest you read Naomi Klein's book "No Logo" (which primarily deals with the clothing/fashion trade, but is the same principle - large corporations outsourcing to the lowest bidder). When the choice is between no job and a life threatening job which doesn't cover the cost of living, but may get your kid something to eat - which one are you going to choose? It's exploiting the poor to increase profits. Pure and simple.
              And as for the argument that wages will eventually increase - that's true. But guess what happens then? The contractors pack up shop and move to the next country that's willing to sell out it's people for less. This trend is well documented and has been happenning for years. As a result, poor countries are often only all too willing to strip more rights from their workers to remain "competitive" in the global market.
              And when something terrible happens (like when the Foxconn workers started jumping from buildings), Apple can say, "this is terrible, but this is not our company, it's just a contractor and we had no idea it was happenning".
              Outsourcing - a great way to do terrible things, and shift the blame to someone else.
              HH - do companies have the right to find the cheapest way to produce their products? Absolutely.
              But shouldn't these same companies, who often have profits larger than the GDP of the countries that produce their goods, have a responsibility to make sure that the people who produce their products are not exploited?
              If your answer is no - you are a terrible person.

                My answer to your question is no, because I do not owe any man anything. If he is willing to work for a dollar a day. Who am I to say that it's not worth it? or are you trying to put a money value on other peoples lives? Are you saying that other people are responsible for your own happiness and not yourself?

                This is not our fault, it's the Chinese. And if they want more, then they are going to have to earn it and build a nation that can self sustaining. Not one that leaps at the crumbs of others.

                If you want companies to stop using the Chinese people then don't buy things made from china. You are the horrible person, you know what you are doing is "wrong" by your own terms. Yet you still buy it which makes your worse then the companies you hate.

                "And as for the argument that wages will eventually increase – that’s true. But guess what happens then? The contractors pack up shop and move to the next country that’s willing to sell out it’s people for less. This trend is well documented and has been happenning for years. As a result, poor countries are often only all too willing to strip more rights from their workers to remain “competitive” in the global market."

                God, your never happy are you? If we offer them work or if we don't, we're all still evil? your so full of it. There are probably countries out there that would love the attention that china is getting or perhaps your saying that the Chinese deserve nothing more then charity because they can't help themselves. If I was Chinese, I would be insulted.

                  Congratulations for not owing any man anything - you are well on your way to becoming CEO of your own multinational!

                  To say that people should be happy with being offered jobs - any job, is simplistic beyond words. If I'm starving and you offer me a bit of moldy bread - guess what? I'll swallow it. But just because you can do it, doesn't make it right. The problem is that one side is holding all the cards, the other side doesn't even know that a game is being played.

                  That's not saying someone deserves charity - it's saying that someone who helps generate billions in profits by manufacturing goods should be paid enough to provide the basics for them and their family.

                  Work for a living wage. That's not charity, that's corporate responsibilty. Something that gets lost, when you cover yourself over with layers of outsourced "contractors".

                  Justify it however you want, just because you CAN do it, doesn't make it right.

                Alright first things first, if you're going to argue on the internet LEARN HOW TO USE A KEYBOARD. I feel kind of bad participating in this discussion now because I'm almost certain you are mentally retarded.
                Aaaaanyway let's get to it shall we?

                "that it’s not extortion. If I almost killed someones, that doesn’t mean i killed them."
                You missed my point entirely, what I meant (in simpler terms) is that by only giving someone two shitty choices, one worse than the other, you are almost forcing them to pick the less shitty option, thereby extorting their labour from them as they are so desperate because if they don't work they will almost certainly die. This preys on their weakness and uses it against them. Your pathetic attempt at an analogy is completely irrelevant.

                "Companies don’t have the power to dictate the social situation."
                So where do fucking jobs come from idiot? THE SKY??

                "… people are the ones who choose to accept."
                They accept what shitty choice is in front of them, DICTATED TO THEM BY THE COMPANIES OFFERING THE JOBS. If they don't they either die or are imprisoned for trying to improve conditions by forming a union or worse yet become a refugee and try their luck at leaving their country for greener pastures, and most likely become the prey of people smugglers or die at sea. great choices.

                "The only way a company could dictate the social situation is to destroy what people already have so they can offer them less… but that act in it’s self (destroying another persons property) is criminal."
                I don't think you understand, THERE IS NOTHING ELSE. THEY HAVE NOTHING TO BEGIN WITH. Its not like they are choosing to work at a shitty factory when they could just go and be a ceo of a major bank. THEY HAVE NOTHING, THAT'S WHY THEY ARE SO DESPERATE and that's why the companies have them by the balls.

    I would love to see Gizmodo do some polls on how much people are willing to pay for their iphones etc., if they knew the money was going towards increasing peoples working conditions or if the products were produced locally.

      This
      I'd definitely be willing to pay more for an iPhone or an Xbox if I knew the extra money meant better conditions for the people building them.

        Yet Apple just released their best quarter EVER.

        Their products are already drastically overpriced. I admit I own a few of their products, but they could release them at the same price as other laptops or lower the price of their iPhones, still make a killing and probably sell more.

        However they wouldn't NEED to increase the iPhone by $65 to cover that difference for the workers. The amount of profit they make is massive considering their products are literally made out of the same junk as other products. It's all about the brand!

      I would gladly pay the extra $65 to have a phone built by people who were treated like human beings (i actually thought it'd be more), especially when you consider most phone providers here let you pay for a phone over a 24-month contract. That's only about 0.63 cents a week extra.

        What if everything from china cost an extra $65, everything...

        Even with the extra $65, i doubt it would actually reach the Foxconn workers. It would just end up as Apple's profits and the same conditions/wages etc remain with the workers.

          Apple is one step ahead of you already.

    I think this is a process of Evolution. Eventually, as the middle class grows in countries like China and India, the laws will change to prevent exploitation/unfair working conditions. Conditions not so long ago used to be like this in the West, and I'm quite sure conditions would have been worse in China 10-20 years ago too.

    I think its a fair comment also, that a lot of people do care, probably within FoxConn itself (doing horrible things to its image), but a lot of those people in SOME respects are living a better life than they would be if they were a rural peasant. The end never justifies the means of course, but I think a balance is moving between the two.

      oh yeah, it would cost far far far far far more than an extra $65 an iPhone. The cost of infrastructure/land/transport etc would be astronomical to set up.

      You make a lot of sense Edward.

      Except there shouldn't be laws to "enforce" people not to do something they want to do in fair trade. If i am willing to work in conditions that you find unfair (for whatever reason: more money, closer to home). Then you have no right in stopping me.

        Yes but then you set a precedent and someone will come along who will work more hours for less in worse conditions, and so on until it's as bad as it can possibly get. Meanwhile the people who run the factories/companies are laughing all the way to the bank by exploiting peoples need to work and thus survive.

        That doesn't seem right to me.

          If i forced you out of your jobs because I think you don't know what is good for yourself, do you think that's fair?

            First of all I only have 1 job, and second who are you to force me out of my job? You're not my boss, you're some anonymous person on the internet and what does your opinion of what you think is best for me factor into it?

            The only way you could 'force' me out of my job would be if you were willing to work for less/longer hours/worse conditions and my boss would rather hire a moron like you who will work for 5c a day, 23 hours a day up to his knees in a pile of excrement than pay me a decent salary to work normal (ish) hours in a nice office.

            Which is exactly what I said before.

              "hire a moron like you who will work for..."

              Are you calling the people of China morons for not working for as much as you?

              gee... kinda sounds like it's Chinese's problem for accepting crappy jobs...

              i'm kinda confused which side your on.

                Geez you really don't get it do you, do you even read my comments?

                I was saying that if you were willing to undercut ME in MY JOB in AUSTRALIA of your OWN DOING then you are an idiot.

                These people who work at the factories have no such luxury of picking and choosing between jobs with proper bathrooms and superannuation, they can only take what is on offer, dictated to them by the factory mangers and by proxy: the larger corporations who employ these factories. The people who run the factories are trying to make the most amount of stuff for the cheapest price so they are the ones who offer these shitty jobs and because everyone is so desperate, play them all off against each other to get them to the lowest point. That is amorale and cruel, using peoples weaknesses to shave off dollars just to impress apple of microsoft or whoever so they can continue to exploit their countrymen.

    Meanwhile the company owners make millions a year. It's obviously at the cost of everyone.

    The fat cats are making money by exploiting overseas labour, earning millions in the name of profit. Do you really think they deserve millions? For exploiting the small guys? For cutting corners and increasing their profits at all costs?

    They're the problem. They're the source of all problems in our world: greedy capitalists.

    I'm sure if manufacturing was offshore, they'd manage to find a local Foxconn which hired illegal immigrant labour and were also treated like shite.

    It is really up to China to raise their standards, and up to us to yell at them until they do. Then when manufacturing costs in China increase we can shift production to the next country with crappy labour conditions.

    "The more things change..."

      Terrible proofreading by me. First sentence should read:

      I’m sure if manufacturing was brought onshore, they’d manage to find a local Foxconn which hired illegal immigrant labour who were also treated like shite.

      Yeah, that's the kicker- if Chinese companies brought their standards up to Western ones, it wouldn't be cheap to make stuff, so companies would go elsewhere (eg India). Which would tank China's economy and bring the rest of the world down with it. Everybody wins!

        china has relatively good employment laws the problem is the enforcement and local government corruption. especially in terms of firing workers and when they are entitled to compensation.

      The problem is China knows that these conditions are the major attribute driving their economy. They export labour the same way other countries export minerals. We can yell all we want and they're just going to shrug it off because they know that without slave labour they're screwed. I'd say it goes beyond simply not caring what the general public of other countries think to the point where they CAN'T care.
      If they bring their workshops up to our standards they'll loose their edge and sink their economy.

      The only thing they'll respond to is pressure from the companies paying the bills, and even then they're going to be extremely reluctant because once they start raising their prices they get closer and closer to the point where Apple and the like realise it's only going to add $10 to each unit to add a 'Proudly 100% made in the USA' stamp on it.

    Lets not beat around the bush it comes down to a choice that we the purchaser has to make. Do we prefer the Money in our pockets that buying these cheap products allows us. Or do we care about these poor people being horribly exploited. That is it.

      I think that's a fair point, but we also don't really have a lot of a choice. What I mean is that say you're going to buy a games console. Sony builds stuff there, but so does Nintendo and Microsoft; wherever I choose to spend my money I'm supporting it. We're certainly part of the problem, constantly looking for lower prices for everything, but I don't think we can be totally blamed.

      I'd be interested to see what happened if they announced a price for the new Xbox, say, that was 50 bucks more than expected, but they announced that 50 dollars of the price was going to improving the conditions of these factories and employees somehow. Would people not buy it because of the 50 bucks, or would they consider that a worthwhile place for the money to go? Would we even believe Microsoft when they said it?

    After reading more and more about this situation, I'm feeling more and mroe guilt as a consumer. The probelm is, our TV's, computer parts, phones, and most electronic equipment are all made in very simillar conditions (if not the same factories!).

    Do we make a personal judgement and stop buying these products which are a part of our every day lives, or do we make a stand and fight to bring the point directly to the companies who make these products?

    In the end, all of these products are luxuries. We like them, but we don't need them. If i have to pay 20%, 30% or even 50% more to know that people are not being exploited to produce these toys for us, then I'd gladly do it.

    Big companies make such an argument about people paying for music and movies rather than pirating it, but personally I'd be much more willing to pay more to ensure peoples well being rather than to make sure a big record company meets their estimated budget for the quater.

      I completely agree with you, it's a very sordid state of affairs, and very hard to get information on, as big companies work very hard to put a lid on bad news.

      I would definitely be willing to pay more if I knew that my money was DEFINITELY getting through the chain to the people that needed it, but unfortunately that's pretty much impossible at this point, short of giving them your money in person.

      The big companies make a massive amount of noise about piracy etc, you only have to look at the whole SOPA incident to see how much power they have, being able to push a bill like that so far through the us government just to protect their own interests. It's very hypocritical when you consider the amount of people they are exploiting to get keep their companies and lifestyles going.

    "“You can either manufacture in comfortable, worker-friendly factories, or you can reinvent the product every year, and make it better and faster and cheaper, which requires factories that seem harsh by American standards,” a current Apple executive told the New York Times. “And right now, customers care more about a new iPhone than working conditions in China.”"

    That apple executive is a monster O_O

    Colour me impressed by this article, Mr Ashcraft.

    It's unfortunate, but it's also not in any way my fault.
    US companies are to blame for chasing profits, and China-gov is to blame for manipulating their currency value.

    Just because something is in demand, does not mean it should be met with supply, they will always try to blame the consumer, but our hands are clean.

    Kotaku: Please publish a list of all companies who use Foxconn. I'd like to boycott them and anyone who does business with them.

    What?! Wait! You mean Steve Jobs isn't a saint? But you guys were all up his arse when he died?
    Man I hate hypocrits.

    Brian, please forward this to Mr plunkett with a note that this is what actual journalism looks like?

    But yeah.. China raises its standards and manufacturing moves on to countries India and Bangladesh. the best (but still slim) hope is to appeal to the contracting companies themselves. It's worked with coffee companies. Damage their image enough and pr takes over. Of course in apples case its just as likely their legal team would.

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