More money for vulnerable workers - the Apple example

Fri, 03/25/2011

I propose an important new measurement for supply chain labor rights – how much money do workers make?

What workers want most is fair compensation. Yet companies do not disclose wages, particularly for contracted employees in their supply chains. They prefer instead to claim compliance (or, rarely, to admit non-compliance) to code of conduct standards like minimum legal wages.

One narrow window into this vital topic emerges from Apple’s recent Supplier Responsibility report . In it the company confirms that it engineered millions of dollars returned to workers. As the company says:
"Apple has enforced a groundbreaking standard for recruiting foreign workers, resulting in reimbursements of more than $3.4 million in overcharges—thousands of dollars per worker in some cases."

These workers paid more than the allowable amount (equivalent of one-month’s salary under Apple’s Code) to a broker for job placement. Apple required that the broker and, in some cases the supplier, return the overcharges to the workers. (Verité has been involved in this effort, as Apple has disclosed.)

Over the course of three years, then, Apple has made many workers in its supply chain far less poor than they otherwise would be. The 'thousands of dollars per worker' amounts to substantial income. No other company has demonstrated such a direct impact, tangible to individual workers.

I am quoted in Apple’s report as endorsing this approach to other companies in the electronics field. Most of Apple’s competitors source from the same facilities and in the same geographies as Apple does. Workers in their supply chains face the same risk and pay the same fees that those in Apple’s factories.

Other companies should similarly hold suppliers and brokers accountable, and make sure that workers receive fair wages. External stakeholders should ask other companies how they have made sure that workers aren't cheated out of real money by the recruitment process.