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Archive for September, 2012

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In April 2010, Dutch fund manager APG Asset Management and seven other global investors jointly engaged Samsung, following the death of Park Ji-yeon, a 23-year-old semiconductor assembler of the company.

Global activist funds have taken issue with the employment of child labor by Samsung Electronics Co. Ltd., the Hankyoreh, South Korea’s independent daily, reported Sept. 18.

“We sent an inquiry to Samsung in August when allegations of Samsung’s use of child labor in China first surfaced,” the newspaper quoted a source of APG Asset Management, of the Netherlands, as saying.  “Employment of child labor won’t be tolerated.  If the allegations turn out to be true we will discontinue investment [in Samsung].”

Confirming receipt of the inquiry, Samsung spokesperson Park Cheon-ho told the Hankyoreh, “APG and other institutional investors requested us to explain the allegations against us.”  He added, “we said there is no child labor [at Samsung], but there is an issue of excessive overtime, which we will examine and address.”

This is not the first time APG, the world’s third-largest pension administrator by assets, has raised concerns about poor labor practices at Samsung.  In April 2010, the Dutch fund manager and seven other global investors jointly engaged Samsung, following the death of Park Ji-yeon, a 23-year-old semiconductor assembler of the company.

However, the effects of the institutional investors’ engagement were limited.  APG said afterwards: “The outcome was not altogether positive.” The institutional investors said, “From the day our engagement started, reports trickled in of Samsung’s behind-the-scenes negotiating with its ailing ex-employees and the families of the deceased.  Local media reported that the company had tried to buy off the case.”

APG concluded, “All in all, we are not satisfied with Samsung’s response so far.”

And young workers have continued to die. During the two years since the global institutional investors’ joint intervention in 2010, the number of victims of Samsung’s leukemia/blood disorder clusters has more than doubled to 56 from 22.

With rising concerns globally about Samsung’s negligence of human rights, SHARPS’s campaign is entering into a new stage.

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Samsung Electronics Co., Ltd. and its Chinese contractors hire underage workers and force their employees, underage or otherwise, to work excessive overtime in harsh working conditions, China Labor Watch, said in a new report released on Sept. 4.

In China, Samsung has a manufacturing network of a dozen directly owned factories and relationships with 250 contractors.  In May-August, CLW, the New York rights group, conducted undercover investigations into six directly owned factories and two contractors.

At least three directly owned facilities regularly hire underage workers.  At Tianjin Samsung Mobile Display Co., Ltd, Huizhou Samsung Electronics Co., Ltd, and Shenzhen Samsung Kejian Mobile Telecommunication Technology Co., Ltd, each employing anywhere between 500-2,000 workers, workers under 18 years of age are required to do the same work as adults without extra protection or legal recourse.

Many of the children are students seasonally hired from local vocational schools.  Student workers have to pay Rmb800 (U$126) in upfront middleman fees, or about half a month’s wage, to be hired.  Students are encouraged by management and their teachers, who often work as middlemen, to forge their documents to pass as adults.  The illicit practice is also profiled in an investigative report by the independent daily Hankyoreh of Tianjin Samsung Mobile Display. 

Samsung at least admitted that there was a need for the company to have Chinese workers working overtime.  “We partly agree with the report that there are times when workers need to work overtime at some plants, especially when we launch new products or build new manufacturing lines,”  James Chung, a Samsung spokesman, told the Wall Street Journal.

Excessive working hours is common practice at the eight facilities.  Samsung and its suppliers flout a legally mandated 36-hour workweek and force workers to work more than 100 hours in unpaid overtime.

The worst is Tianjin Intops Co., Ltd, a supplier, where each of an all-women army of 1,200 contract workers has to work standing for 11 hours a day to assemble a cellular phone cast every five seconds.  At the peak of the production cycle, they must work up to 150 hours of overtime per month.

On its home turf of South Korea, Samsung employees are among the best paid.  However, Samsung’s negligence of its own workers is also well-documented.  SHARPS has to date profiled 56 workers who died of a variety of types of blood disorder and cancer  which they developed while employed at the company’s production facilities.

During a high-profile patent infringement lawsuit by Apple against Samsung, testimony by a Samsung designer of Smartphone icons, Wang Jeeyeun accidentally revealed how much the world’s largest electronics maker is addicted to the daily sacrifices of its overworking workers.

During the three-month period, in which she developed icons for Galaxy S, Samsung’s tablet, she said, “I slept about two or three hours a night.”  Ms. Wang had to stop breastfeeding her three-month-old infant to keep up with schedule.

CLW’s latest report was in line with its findings a month earlier of child labor at Samsung’s supplier, HEG Electronics in the city of Huizhou.  It dealt a fresh blow to Samsung because the report came out on the heels of an internal audit by Samsung which exonerated HEG of hiring underage labor.

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