Apple suspends new business with iPhone supplier over labor violations

From CNET: Apple has frozen the signing of any new business contracts with Pegatron, one of its key suppliers, after the Taiwanese company was found to be breaking the iPhone maker's supply chain rules. Apple discovered that Pegatron had falsified paperwork and misclassified workers in order to cover up labor violations, Bloomberg reported on Monday.

Pegatron, which supplies parts for Apple's iPhones, had asked students at one of its mainland China plants to work overtime and night shifts, which they are prevented from doing under Apple's Supplier Code of Conduct. These rules also stipulate that student interns are only allowed to conduct work that is directly related to their studies, which Pegatron had also not enforced, according to Apple.

"The individuals at Pegatron responsible for the violations went to extraordinary lengths to evade our oversight mechanisms," said a spokesman for Apple in a statement.

Apple said that once it learned of the violations it "worked quickly" to ensure students were safely returned to their homes and schools, as well as to give them proper compensation.

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