Apple says children were used by partners to build iPhone, iPod

SAN FRANCISCO - Apple Inc. said three of its suppliers hired 11 underage workers to help build the iPhone, iPod and Macintosh computer last year, a violation it uncovered as part of its onsite audit of 102 factories.

"Apple discovered three facilities that had previously hired 15-year-old workers in countries where the minimum age for employment is 16," the company said in a 24-page report on "Supplier Responsibility" posted on its Web site. The workers were "no longer in active employment at the time of our audit."

Apple didn't name its suppliers and manufacturers. The company said it visited sites in China, Taiwan, Thailand, Malaysia, Singapore, South Korea, the Czech Republic, Philippines and the U.S. Apple also found three cases where suppliers "falsified records" to conceal underage hiring, more than 60 facilities where employees were overworked, 24 partners that paid less than the minimum wage and 57 who didn't offer all required benefits.

"Apple's Code sets a maximum of 60 work hours per week and requires at least one day of rest per seven days of work," the company said. Apple also said it asked suppliers to end a practice "where wage deductions were used for disciplinary purposes."

The company said it stopped doing business with at least one unnamed supplier after finding repeated violations and "inadequate actions" to address the problems.

Apple's review also found that at eight facilities, including suppliers in Taiwan, foreign workers paid excessive recruitment fees to hiring agencies to get jobs. The company said employees were reimbursed $2.2 million in fee overcharges over the past two years and that Apple has set a standard limiting such fees to the "equivalent of one month's net wages."

Steve Dowling, a spokesman for Cupertino, Calif.-based Apple, could not be immediately reached for comment.

Apple rose $2.62 to $204.62 Friday in Nasdaq Stock Market trading. The shares more than doubled last year.