Business Risk Management: Apple Inc. Report (Assessment)

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Updated: Feb 22nd, 2024

A good number of business analysts would agree that the human resources department of Apple Inc has been risking the future of the company. The company has incessantly violated the fundamental responsibilities of human rights in a workplace. According to Stevens et al. (2012, p.5-6), the primary responsibilities of human resources department in any organization go beyond manpower hiring.

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The department should reach out to all employees, communicate, gather insights and act appropriately. The department should plan appropriate interventions to alleviate unfavorable working conditions and to motivate workers.

The human resources department should assist employees, counsel and enhance their performance. It is also the responsibility of the department to observe all measures in hiring and retaining employees as stipulated by the law, and by the company’s code of ethics.

In 2006, Chinese workers in Foxconn Apple Inc factory in China worked for as little as $600 per year. It was reported that these employees were forced by management to reside in visitor’s restricted factory’s premises.

Poor working conditions and under-compensation was a risk by the human resource department, and it reflected negatively on the company (Musgrove 2006,p.1). Later in 2010, workers complained that the LCD screen cleaner was emitting poisonous substances, and wanted to sue the contractor.

Suicides by employees have been experienced at Foxconn factory in China. An employee committed suicide in 2009 after getting tortured by his seniors; the employee had lost a prototype for Apple iPhone. This incident was against the Chinese and American law, and has had dire impacts on Apple’s reputation.

Between 2009 and 2010, Foxconn attracted media attention after violating employee’s rights on several occasions. For instance, a videotape was released showing employees being assaulted by the factory’s guards. During the same period, twelve workers committed suicide.

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The factory forced employees to sign an agreement in order to prevent occurrence of suicides in the future. Although the document was legally binding, the terms of sanctioning for suicide victims were not clear (Ruggie 2012, p.1).

There have been allegations that the company hires minor and student employees in its factories. Some of these minors are forced to work against their will, and some are from very poor backgrounds. Child labor is forbidden by the US labor law, and it is against the company’s values. Apple has a corporate culture defined by its Supplier Responsibility Progress Reports policy.

The company requires its suppliers to take full responsibility for their errors and omissions. When suppliers fail to meet the stipulated social responsibilities, their contracts are due for termination.

However, these repercussions have not affected the notorious Chinese factory after violating the human rights of its employees, and after breaking both Chinese and US law (Duhigg & Greenhouse 2012,p.1).

Employees’ problems of inadequate pay or low wages, forced, and child labor, physical and emotional abuses should be the concern of the human resources manager in any organization. These problems have continued to occur in Apple Inc factories.

This shows inefficiency and a high degree of risk in human resources department. Senior management at Apple has insisted that the company is applying a lot of efforts to improve the working conditions for its employees. The management has expressed its concerns on underage labor and expressed its desire to get rid of it.

This declaration is a confirmation that the management is aware of the risks being taken by the human resources department. Many multinationals, including Apple, have a code of conduct on rights or employees. The challenge is in the company’s ability to demonstrate compliance with the code.

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References

Duhigg, C, & Greenhouse, S 2012, March 29, Electronic Giant Vowing Reforms in China Plants, The New York Times , pp. 1-2.

Musgrove, M 2006 , June 16, Sweatshop Conditions at IPod Factory Reported,Washington Post , pp. 1-2.

Ruggie, J 2012, April 4,Working Conditions at Apple’s Overseas Factories, The New York Times , pp. 1-2.

Stevens, J, Jeynes, V, Cotena, E, & Edelson, M 2012. Managing Risk: The HR Contribution, London,UK: Routledge.

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