Apple has severed its relationship with a China-based third-party labor supplier after discovering a conspiracy to employ dozens of underage workers there, Apple reported in its latest Supplier Responsibility report, which was released this evening.
The iPhone maker said it discovered the violations during an audit of the supplier, Guangdong Real Faith Pingzhou Electronics (PZ). In addition, Apple reported the labor agency that knowingly provided the child labor to PZ to local authorizes.
The agency, which allegedly conspired with the children's families to falsify age-verification documents, had its license suspended and was levied a fine.
"The children were returned to their families, and PZ was required to pay expenses to facilitate their successful return," Apple said in the Supplier Responsibility report (PDF). "In addition, the company that subcontracted its work to PZ was prompted by our findings to audit its other subcontractors for underage labor violations -- proving that one discovery can have far-reaching impact."
The revelation was included in Apple's annual report on its efforts to improve employee safety and working conditions at its manufacturing partners' production facilities. The condition of workers in the electronics industry has come under intense focus in recent months. As a result, companies such as Apple and Samsung have pledged to do more to prevent the abuses.
"Underage labor is a subject no company wants to be associated with, so as a result I don't believe it gets the attention it deserves, and as a result it doesn't get fixed like it should," Jeff Williams, Apple's senior vice president of operations, told Bloomberg in an interview.
In its report, Apple said it conducted 393 audits in its supply chain last year, a 72 percent increase over 2011. The audits included reviews on environmental and operations safety, business practices, and employee recruitment.
The company said it achieved an average 92 percent supplier compliance with the maximum 60-hour work week. Last year's report indicated compliance averaged 38 percent. Apple says it is now tracking more than 1 million workers in its supply chain and posting the results each month on its Web site.
The report comes a few months after key Apple supplier Foxconn admitted it had hired interns who were under 16, China's legal working age. Foxconn said in October that it discovered the violations during an internal audit and that it would "immediately" terminate any employee found to have been responsible for the violations.
Apple noted that last year it requested that the Fair Labor Association launch an investigation into Foxconn's business practices. While that investigation yielded a host of violations, including excessive overtime and improper pay, this year's report did not mention any violations found at Foxconn facilities.
The report is the seventh in a series that have been published following scrutiny of Apple's product manufacturing. Previous reports have also focused on working conditions and disposal of hazardous waste.