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Tech giants on trial as report reveals more Chinese factory abuses

VTech in the firing line as attention shifts from Foxconn

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VTech standing firm

Rather disconcertingly, several of the not-for-profits working in the region contacted by The Reg had not heard of the Institute for Global Labour and Human Rights, which says on its web site it was founded in 1981 as the National Labor Committee.

However, it seems to have been pretty active over the past few years, targeting alleged sweatshops in Bangladesh, El Salvador, Jordan and elsewhere using the same blend of confrontational language and shocking revelations backed up by photographic evidence and heart-rending first person accounts, designed to garner maximum publicity and shame Western companies into action.

Hong Kong-based VTech, which reported revenues of $1.78bn (£1.1bn) in fiscal 2012, released a strongly-worded statement last Friday rejecting all allegations and saying it is considering legal action against the Institute for Global Labour and Human Rights.

It maintained that it has a long track record of good labour relations in mainland China:

VTech is a responsible and caring employer wherever it has operations, and this includes mainland China. The group and its subsidiaries abide strictly by the legal requirements relating to employment in all jurisdictions where it operates, including mainland China. Emphasis is placed on people-oriented management to ensure harmonious staff relations, especially in the group's manufacturing facilities. VTech takes care to ensure that the work environment is safe and that employees are adequately housed and cared for.

VTech confirmed to The Reg that it had no updated statement since then, despite Aussie telecoms giant Telstra's decision to suspend sales and rentals of all of its VTech-built products until further notice.

"Telstra is deeply concerned by the report," noted a statement sent to The Reg.

"Compliance with the law is mandatory for all our suppliers and labour misuse is totally unacceptable to us. We have asked VTech to respond urgently."

Motorola clarified to The Reg that while VTech is not a contract manufacturer or trademark licensee, it does “manufacture on behalf of some of our trademark licensees”.

It continued:

We have asked our licensees [to look] into the matter. We place a high priority on the safety and welfare of our employees and our suppliers’ employees. We expect all suppliers and licensees to adhere to our Supplier Code of Conduct, which is publicly available on our website, and to comply with local laws and regulations.

What has become clear from the scrutiny placed on Apple and Foxconn, however, is that having a code of conduct alone is not enough.

No easy solution

Debby Chan, a project officer at Hong Kong-based SACOM, which released several critical reports into abuses at Foxconn factories, argued that successful reform of VTech will require employees to be given a democratic voice in the running of their workplace.

“SACOM knows very well that the factory inspections are always bogus or fail to find out and fix the problems in the factories,” she told El Reg.

“As such, the workers should have the right to organise themselves through democratic trade unions. The unions are the prerequisite for workers to channel the grievances and report the abuses.”

The problem in mainland China, however, is that unions rarely represent workers’ interests and the government has little desire to change this.

Geoff Crothall, a spokesman for Hong Kong-based rights group China Labour Bulletin, argued that the conditions highlighted in the report are common among electronics companies situated along the Pearl River Delta.

“I'm sure all of the complaints in the report are genuine and do come from the workers themselves but I'm equally sure if you talk to other workers at VTech they will not be talking about suicide as a way out,” he told The Reg.

“If you look at the response of most factory workers now to bad conditions, it is to go out on strike or stage a protest. I think this is where I would take issue with the report, in its portrayal of workers as helpless victims.”

Philips had yet to reply at the time of writing. ®

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