Apple Inc. share price down, to review allegations of new labour violations in China

Only a few days before Apple Inc. is set to reveal its new iPhone 6, a report by two U.S.-based non-profit groups accuses the company in safety and environmental violations at a China-located factory run by a supplier of the company. The investigation, which was conducted in August 2014 and the allegations are a fine example of the close examination, which is imposed on the US-based company and its suppliers in China over labor issues.

“The investigation of Catcher Technology raises serious concerns around working conditions in Apple’s second-tier supplier factories,” Todd Larsen, corporate responsibility director for Green America, said in a statement cited by Bloomberg.

According to the report by China Labor Watch and Green America, Catcher Technology, a Taiwan-based supplier of Apple, had 22 labour violations. The two organisations found out unpaid overtime and improper handling of hazardous materials at a factory in Suqian in eastern China. About 20 000 employees currently work in the plant, which supplies several electronics companies, including Apple with metal casings.

Mr. Chris Gaither, who is a spokesman of Apple, said that the company had already been working with Catcher to address concerns following routine inspections. A quarterly fire inspection was carried out by the company last week.

“We had scheduled a follow-up visit next month to review their progress, but have dispatched a team there immediately to investigate this report,” Gaither said in an e-mailed statement cited by Bloomberg. “Apple is committed to ensuring safe and fair working conditions for everyone in our supply chain.”

Green America and China Labor Watch claim that the employees, who work at the plant, were forced to work overtime. In addition, the groups claim that workers were not provided with proper protective clothing when handling toxic chemicals. The non-profit organisations explained that their report is based on more than 100 interviews with employees of Catcher, as well as on the experiences of an employee, who was paid by the groups to work at the plant in August.

Apple is not the only company, which has recently been facing scrutiny over labor conditions at their suppliers factories in China. Samsung and a few other multinational companies were also accused in violating working conditions at Chinese plants where a lot of their products are made.

The two groups also claim environmental negligence and alleges that some industrial scrap (metal scraps, oils, etc.) were discarded into a sewer, and some of them ended up in a river near the facility in the city of Suqian, in eastern Chinas Jiangsu Province.

Apple Inc. fell 0.83% on Thursday to close at $98.12 per share, marking a one-year change of +37.73%. The company is valued at $587.53 billion. According to CNN Money, the 42 analysts offering 12-month price forecasts for Apple Inc. have a median target of $107.50, with a high estimate of $135.00 and a low estimate of $51.43. The median estimate represents a +9.56% increase from the last price of $98.12.