Pegatron will not receive any new business until it takes all necessary corrective actions required, according to media reports.
Apple has put its Taiwanese supplier Pegatron on probation over charges of violation of the tech giant's supplier code of conduct. (Reuters Photo)
Apple has put its Taiwanese supplier Pegatron on probation over charges of violation of the tech giant’s supplier code of conduct. Pegatron will not receive any new business until it takes all necessary corrective actions required, according to media reports. The supplier firm allegedly has made student employees work on overtime and on night-shifts.
The US tech major accused Pegatron of misclassifying student workers and even forging paperwork to disguise the violation. They have also allegedly allowed the students to work on projects that are unrelated to the company, thus further breaching the code of business conduct.
Apple in a statement said that several weeks ago they found out about Pegatron violating supplier code with how they handle student work programmes. Their inside investigation, however, has found no evidence of underage or forced labour but the executive who was in charge of supervising the programme has been terminated. The company further accused the individual in charge of oversight of going to ‘extraordinary limits’ to escape their surveillance measures.
The decision by Apple, meanwhile, affected Pegatron’s market shares as it closed down 2.1 per cent, underperforming a 1.2 per cent rise in the Taipei market on Monday. The company without mentioning its issues with Apple in a statement said that they have found students in Kunshan and Shanghai campuses working with complying to local rules and regulations. And hence have been taken off the production line by giving proper compensation.
Pegatron and Foxconn are among the biggest assemblers of Apple iPhones in Taiwan.
Apple for some time now has been under the scanner over concerns of poor labour practices but the company is trying to revamp its image by releasing an annual review of the iPhone supply chain and Pegatron, Foxconn are part of this. In 2017 Apple and Foxconn in a statement said few students were found working overtime in Chinese factories. In July another Taiwanese assembler sold off two factories to Chinese home-grown supplier Luxshare and are increasing competition with Taiwanese supplier giants.