--Nonprofit's interim report finds Apple supplier Foxconn meeting deadlines

--Foxconn plans to meet remaining goals by July

--Audit follows criticism of Apple supply chain

 
   By Drew FitzGerald

A top Apple Inc. (AAPL) supplier has fixed some of the most pressing workers' rights violations at three of its Chinese factories and is on track to address other problems by mid-2013, according to a progress report by the electronics giant's industry-backed auditor.

The Washington-based Fair Labor Association said manufacturing facilities run by Hon Hai Precision Industry Co., known by its trade name Foxconn, already have benefited from physical improvements such as ergonomic breaks and better maintenance of safety equipment, and the company is backing a local law adjustment that will extend unemployment insurance to more workers.

The electronics supplier also identified 89 tasks it completed ahead of schedule, though the FLA said some of its most challenging goals--which include lowering overtime hours for more than 170,000 employees to within legal Chinese limits--remain a work in progress.

Foxconn said the report proved its facilities are reaching their targets, calling the review "the largest and most comprehensive assessment of an electronics manufacturing operation ever undertaken by any independent audit organization in China."

Apple spokesman Steve Dowling said the company was proud of the progress it has made so far with FLA.

Apple launched the overhaul after its report in January found only 38% of its suppliers last year met its requirement for a maximum 60-hour workweek and at least one day off every seven days. Amid mounting criticism of its supply chain, the Cupertino, Calif., company in February became the first electronics company to join the FLA, which garners support from contributing corporations and nonprofit organizations.

The organization's spring audit reviewed practices at the three Foxconn facilities that make products like iPhones, iPads and MacBooks for Apple in Shenzhen and Chengdu. The investigation, which used local inspectors and surveyed about 35,500 workers, flagged dozens of labor-standard violations, including employees who worked as many as 70 hours a week during peak production, sometimes under unsafe conditions. The long workweeks violated Apple's guidelines as well as Chinese law, which caps overtime at 36 hours a month.

Foxconn has committed to meeting that requirement and 75 remaining improvements by July 1. FLA's affiliation requirements give members like Apple up to two years to meet all of its workplace standards.

Write to Drew FitzGerald at andrew.fitzgerald@dowjones.com

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