The South Korean electronics giant says that following China Labor Watch's reports on its suppliers, it undertook in September a wide-ranging audit of 105 suppliers in China to ensure that the companies adhered to labor laws and Samsung's own code of conduct. The company is presently investigating an additional 144 suppliers in China and expects to conclude that inquiry by the end of the year.
Samsung said in a statement that while it did not find any child labor violations -- a problem documented in August -- it did identify "several instances of inadequate practices at the facilities, including overtime hours in excess of local regulations, management of supplier companies holding copies of labor contracts and the imposition of a system of fines for lateness or absences."
Samsung says it is developing new guidelines on hiring, work hours and overtime to improve working conditions for employees of its suppliers. And it says that in 2013, it will turn to the Electronic Industry Citizenship Coalition, a third-party labor auditing organization, to monitor labor practices at its suppliers.
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Apple, which has also been dealing with complaints about working conditions at its suppliers in China, earlier this year engaged the Fair Labor Association, another industry oversight group, to audit companies in China hired to assemble its products. Labor activists however often criticize industry-oriented groups like the FLA and the EICC for being insufficiently independent from the companies they assess.
China Labor Watch, a group that has been working for more than a decade to improve labor conditions in China, says that over the past three months it conducted follow-up investigations of four Samsung suppliers -- Tianjin Samsung Electronics, Tianjin Samsung Mobile Display, Tianjin Samsung Communications Technology and Tianjin Samsung Opto-Electronics -- by interviewing 23 workers. The labor group says Samsung has made no improvements since its report two months ago. It claims that problems like illegal overtime demands; abuse of temporary workers, underage and student workers; employment discrimination; unfair treatment; and low wages persist at Samsung factories.
Samsung insists changes are being made. By the end of the month, it will require suppliers to install devices to detect fake identification cards and prevent the employment of underage workers relying on fake IDs.
Samsung says that by the end of the year it will have demanded that all suppliers make their labor contracts legally compliant and provide workers with a corrected copy. It insists it will direct suppliers to: abolish systems that fine or penalize workers; provide first-aid kits in factories and dormitories, along with safety training; provide extra training for managers about sexual, physical and verbal abuse; and establish hotlines for workers at suppliers to anonymously report mistreatment or labor law violations.
In addition, Samsung has acknowledged the need to reduce overtime at its suppliers and says it plans to implement changes to end work beyond legal limits by 2014. The company also says it will require that suppliers limit the number of temporary or dispatch workers to 30% of full-time staff. In the past four years, according to Businessweek, the use of temporary workers has more than doubled -- now accounting for more than 60 million, one-fifth of China's 300 million urban workers -- since a 2008 law made companies pay for worker insurance, overtime and severance.