Call Indicates Audit of Foxconn is Likely Precursor of More Intense Scrutiny of Global Companies' Operations in China

Global employers with large-scale operations in China will likely face increasing pressure from NGO and government sources following a high-profile audit by the Fair Labor Association (FLA) of Apple’s manufacturing facilities at Foxconn, according to FLA CEO Auret van Heerden on a recent HR Policy global call.  As van Heerden explained, the report shows that even at one of China’s premier manufacturing facilities, issues like hours of work violations (Chinese law allows no more than 49 hours per week) and management issues like worker communication and engagement are major concerns.  For example, though Foxconn has a massive union operation (roughly 15,000 committees in the main facilities alone), the audit found these committees were comprised almost entirely of management.  “We would find one or two workers at most on those committees, and even they had been handpicked by management.  So they were just getting no upward communication.”  According to van Heerden, a key part of the Chinese government’s strategy for mitigating labor unrest hinges on making these committees more representative, so companies may soon see changes in this area.  The FLA’s report is just the first in a series of audits it is conducting of Apple’s operations in China, but as HR Policy’s Chair of Global HR Initiatives, Bill Allen, Group Senior Vice President and Head of Human Resources at A.P. Moller-Maersk Group pointed out, “it comes at a time when most of our companies are increasing their own footprint there” and may be a bellwether for what others with similar operations might expect to find.  Whatever the outcome of the full investigation, as Brad Grider, Director, Labor and NGO Relations at Hanesbrands, Inc. (a member company of both HR Policy and FLA) concluded, the quality and comprehensiveness of the report went a long way towards silencing the doubts and false accusations voiced by opponents of the FLA who had predicted a whitewash in favor of Apple.