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Workers' Compensation systems are programs base benefits on wages converted to rates of payment and that is the basis for the payment by an employer for workers' compensation coverage. Honest employer reporting enforced by random retroactive insurance company audits guard against employer fraud.
The US laws for workers' compensation work as a mechanisim to encourage safer working conditions. Additionally, the exploitation of child labor triggers penalties against the employer. The penalties are both civil and criminal in nature.
On February 23, the occasion of Apple's 2012 annual shareholders' meeting, the IMF, GoodElectronics and makeITfair call on Apple shareholders to do the right thing in an open letter. Apple has recently joined the Fair Labour Association (FLA), but recent developments point to this being no more than a PR stunt.
FLA is currently conducting an investigation of labor conditions at Apple supplier Foxconn in China. Although the FLA report is only due in March, it has already been reported that the FLA has formed a positive opinion of conditions at Foxconn, without yet interviewing workers. This casts doubts on the independence of the investigation (FLA is directly funded by Apple) and the credibility of its final report. Contrary to FLA's standard methodology, the Foxconn investigation was not unannounced which has allowed the company to hide abuses by banning illegal overtime for 16-17 year olds during the period of the investigation.
Apple's initiative in joining FLA was appreciated, however, misusing the initiative as a PR stunt will reflect very badly on Apple's sustainability initiatives and statements. The open letter tells shareholders that in addition to proper auditing, Apple also needs to look into improving its purchasing practices by ensuring fair prices and well-planned lead times, allowing workers to work normal hours and earn a living wage.
The IMF, GoodElectronics and makeITfair are among a growing group of concerned trade unions and other civil society organisations calling upon Apple to improve its act and stamp out persistent violations of labour rights in its supply chain.