Samsung’s child labour headache

Samsung Electronics is mired in controversy over child labour, the last thing it needs following its high-profile legal defeat in the US over technology patents.

Samsung has rejected allegations that a Chinese supplier used child labour after conducting an internal inquiry. But the issue is still a headache for the South Korean technology giant.

Last month, Samsung conducted an audit of HEG Electronics, a contract manufacturer of  mobile phones and DVD players, in response to a report by China Labor Watch, a US-based non-governmental organisation that HEG was using child labour at its factory in Huizhou, southern China.

“Samsung holds itself and its supplier companies to the highest standards,” the company said in a statement. “If HEG fails to meet Samsung’s zero tolerance policy on child labour, the contract will be immediately severed.”

But it added that its investigators did not find any underage workers during the site audit at HEG, although it did find some workers under the age of 18, whose employment is legal because they are over the legally-allowed age of 16.

However, Samsung said it found some labour problems concerning overtime work and lack of access to a medical clinic. “Samsung has demanded that HEG immediately improve its working conditions,” the company said.

Samsung said it would complete this month on-site inspections at all of its 105 supplier companies in China that produce products only for Samsung. It also promised a review via documentation of 144 more supplier companies in China by the end of this year.

Working conditions in Chinese factories have been under close scrutiny since a series of suicides by workers at Foxconn, which supplies Apple, in 2010. There were allegations early this year that Apple’s products were assembled in China amid multiple violations of labour laws including extreme working hours. Apple and Foxconn subsequently agreed to tackle such violations at factories employing 1.2m workers.

China Labor Watch claimed after conducting investigations in June and July that working conditions at HEG were “well below” those at Apple suppliers. Child workers at the HEG factory faced the “same harsh conditions” as adults and were paid 30 per cent less, the NGO said.

Despite its denial, Samsung still has work to do to manage the impact of the allegations on its reputation – a huge asset for any global company. Its status as a global technology innovator has already been shaken by the recent US verdict that it copied some design features of Apple’s iPhone and iPad.

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