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Child Labor

In: Social Issues

Submitted By enjisweet
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Enjoli Baker
Week 6 Assignment
BUS670: Legal Environment

Timory Naples


2 There was a internal audit that was conducted on Apple, they found that 106 children were working at more than 10 factories creating Apple products in the past year alone according to The Guardian. (n.d.). Hiring children means that the child labor laws are being violated. Also this is morally wrong and not for the greater good of the people. Apple conducted an investigation on it's suppliers. The result of that investigation was unexpected. They found out that children were being recruited using fake identity papers. Child labor is obvious because of the harsh working conditions provided by Apple. Most of the children worked for Chinese companies that made supplies for apple. The children were under the age of 16; they employed about 74 children out of the 106 total according to The Guardian. (n.d.). Most of the cases are from 2013, and total there have been 70 companies in Apple's supply chain that have employed children according to The Guardian. (n.d.). There has been a host of other events happening when the whistle was blown so to speak. There have been cases of workers committing suicide, and also deadly explosions at some of the supply chains. This is relevant because workers slowly began to figure out that children were being used for labor, and these were some of the consequences. The children had to lift heavy equipment, and some of them were subject to pregnancy tests as well. If the children got into trouble while working they would be punished by having their pay checks docked. Apple's chief executive was in charge of keeping detailed records on the supply chains. When he reviewed all of the records he fired one company in china, even though he knew from the reports that more than one supplier violated the child labor laws. The facts are true according to The Guardian. (n.d.) Apple claims that they had no idea that their supply chains were allowing underage children to 3
work. In other countries, parents want their children to work because the family is in poverty and they need as much revenue as possible. In the United States a company will be frowned upon for allowing underage children to work and earn a wage, no matter how poor the family is. The truth is children should be able to be children, go to school, and play outside, because when they become adults they will learn that life is not that fun after all, because as an adult you have more responsibilities.

Sacrificing a child's education to make revenue for a company is an unethical practice. Organizations have a choice on rather they would like to act ethically or unethically. Let's analyze several ethical theories that these companies could have used. The first theory I would like to go over is utilitarianism theory; this theory states that the actions that are done, should bring about the greatest good for the largest amount of people. Actions that fall short are to be seen as wrong or simply uneithical according to Seaquist, G, Business Law for Managers, (2012). Utilitarianism theory basically assigns a negative or positive judgement to actions, based on what the intended consequences are. In this theory the wrong actions are seen as negative and the right actions are seen as positive according to Seaquist, G, Business Law for Managers, (2012). If you analyze this particuler business situation in conjunction with this theory you will begin to see how they could have utilized it. If Apple's subsadaries had followed the Utilitarianism theory they would have used ethical actions from the beginning, this means not employing underage children. This would include not forging documents and also not punishing the children for negative actions at work. In order to have positive actions it would have to start with the hiring process, and only hire adults who had the correct paperwork. Making children work and not supplying the correct paperwork is unethical. This means that the organizations were not looking to complete actions based on the positive outcomes to the greatest number of people.
A positive outcome, would equal positive actions. In order to do the greatest good for the greatest number of people, you would not put physical demands on children, hire them or make them suffer consequences at the work place. Doing the greatest good in this theory would mean allowing the children to remain at school and get an education, and allowing them to help their families in other ways. Taking a child's childhood is not ethically sound it is morally wrong, because of the effect of the outcome. Which is the missed education, and also the conditions that the children would have to endure in order to work for a organization. In this theory the intended consequences were negative because they were revenue driven, that equals a negative outcome. If the intended consequences were positive the children woulf have never been hired resulting in a postive outcome. Another theory we can apply is the Deontology theory. This theory states that the moral of the situation relies in the motives of the person completing the actions. In this theory, the rights of a person are very important and there are things that should not be done, even if it benefits a large number of people. “Although deontology contains many positive attributes, it also contains its fair number of flaws. One weakness of this theory is that there is no rationale or logical basis for deciding an individual's duties. For instance, businessman may decide that it is his duty to always be on time to meetings.” Seaquist, G, Business Law for Managers, (2012) This is the right thing to do but it does not have to be treated like a duty. The reason he needs to be on time is because he like to sit in the same spot. There are similar situations that bring the other two faults of deontology in play, concluding that sometimes the other duties a person has might get in the way, and in the world of deontology there is no concern for others at all. For instance, if the deontologist that's always on time, is late how does he get to his destination fast enough? Is the deontologist going to break the law, or break his duty of being on time? Seaquist, G, Business Law for Managers, (2012).
In the end in the example the person should uphold the law instead of concentrating on his duty, which is to be on time. If the Deontology theory could have been followed in the beginging the children would have not been hired. This would have been seen as bad for the greater good, the outcome would have been positive if the Deontology theory would have been followed. In the case of Apple suppliers, their motives were unethical. Because the motive was gaining revenue by any means neccessary. Therefore, they would be seen as morally wrong, they viewed their actions as duties. In Deontology it states that the actions are not to be seen as duties. There are things that a organization should not do even if it helps a large number of people. In this case making children work, did help a large number of Apple customers get their goods and it also helped their family gain revenue. But the actions should not have hapened even though it helped the greater good at the time. The organizations choose to hire the children even though it was morally wrong and their motives were negative. The bottom line is even though they increased revenue they should have hired adults instead of subjecting children to that harsh environment. In this theory basically the outcome was negative because the motives were negative. If this theory was used correctly the motives would have been positive and so would the outcome. In the case with Apple's suppliers violating the child labor laws, The Fair Labor Standards Act was established in 1938, for situations like this. The act established a certain amount of hours per week that a adult could work, prohibited minors from being put to work, established minimum wage, and it also insured time and a half for overtime. This act has been violated by the Apple company, by employing minors. The Utilitarianism theory would have been the best theory to follow because it works toward the greater good for the largest amount of people. Ethics are very important in business and other areas of life. Ethical outlooks need to be positive and have the ability to uplift the morale of a company or person. An organizations code of eithcs could 6 help that organization avoid legal issues by doing what is morally right in the beginning. The benefits of acting ethical in business are, attracting more customers to their products, increased work productivity, attract new potentional employees, reduce the turnover for existing employees, and also attract investors. Also there are rarely any legal issues when companies act ethically instead of unethically. In the case of child labor the ethical decision would be not to employ minors, this decision would be for the greater good, thus avoiding a lawsuit from a company they are working for when the company finds out about the children being hired. The Utilitarianism theory would have created the best possible outcome, because the concern would be the greater good for the people. This theory would also create a postive legal outcome for the company, if the children were not hired in the first place. A company can sue you if you are using underage children to make their products if you are their supplier. The best legal outcome would result in the use of the Utilitarianism theory. They need to return the children to their families, pay expenses to facilitate their successful return. (The Guardian. (n.d.). Applying the particular actions would make the outcome ethically sound and create a ethical business environment for employees to follow. No matter what business conflict you are in, you can turn it around and show the legal world what changes you have made. This will result in a better legal outcome if your organization is taken to court. Your organization can prove how they corrected the situation and how they regret their decisions and what new guidelines they have in place, to make sure the right ethical decisions are made. There are different areas of law that can be assessed in this business situation. The first one is the Fair Labor Standards Act of 1938 (this is a federal law). “In the early decades of the twentieth century, the numbers of child laborers in the U.S. peaked. Child labor began to decline as the labor and 7 reform movements grew and labor standards in general began improving, increasing the political power of working people and other social reformers to demand legislation regulating child labor. (The Child Labor Education Project. (n.d.). There were unions organized and child labor reform were often in the same mix as the unions, at this point the most important professional in politics wanted change. They wanted to help the children and their families, so that they would not be taken advantage of. These organizations generated the National Consumers’ League in 1899 and the National Child Labor Committee in 1904, which shared goals of challenging child labor, including through anti-sweatshop campaigns and labeling programs. The Child Labor Education Project. (n.d.). The National Child Labor Committee’s completed a vast amount of work to end child labor. They wanted to have free education for all children and put have restrictions on the working class. Limited the working hours oer week of adults and not allowingminors to work, establishing minumum wage and paid overtime. Consequently all acts were violated by the Apple company. The second law is The Occupational Safety and Health Act (OSHA) of 1970, this act ensures that employers will provide a workplace free of hazards, such as unsanitary conditions, toxic chemicals, and mechanical dangers. Inspections are permitted unannounced or as a result of an employee complaint with OSHA standards (OSHA (n.d.) This act has been violated by the Apple company suppliers, because they provide harsh working conditions for the children. They were exposed to extreme heat and extreme cold, they also were told to dump oil down the toilet in the facility. The environment was not properly cleaned, they also worked on heavy machine equipment that was not properly inspected. They were also told to work long extended hours past the 40 hour work week, they were not allowed to practice proper hygiene because they were always working. The children also did not receive all of their paycheck the supply company took half and gave the other half to the child’s family.
The children were being held accountable for their parents debt to recruiting agencies. If their parents owed a significant amount of money to multiple agencies, then they would make the children work until the debt was paid off. Apple ended up paying around $6.4 million dollars to the families in back recruiting fees, so that their debt would be null in void. Even though the supply companies committed this ungodly act Apple ended up paying for it

“Apple ordered its suppliers to reimburse excessive recruitment fees – anything higher than one month's wages – and said $6.4m was handed back to contract workers in 2012.” (The Guardian. (n.d.).
The OSH Act makes sure that employers provide a safe and healthful work environment and comply with occupational safety and health standards found in 29 CFR, Part 1910, ( Child Labor Laws. (n.d.). Employers must have provide protective equipment to protect workers and they must make workers aware of hazards. They also have to give them proper training on the hazards and safety standards. The third law that was violated was the Civil Rights Act of 1964 “Federal and State laws make sure that Americans are able to have children without losing their jobs ( Child Labor Laws. (n.d.).” “A company can't deny you employment if you are pregnant it violates the Civil Rights Act of 1964. Employers can't refuse to hire a women, force her to quit, deny her benefits or fire her if she has a abortion. (Know Your Rights. (n.d.)” “You must be allowed to keep working as long as you are able to do your job. Your boss cannot make a rule about how long you must stay out of work before or after childbirth. If your company does not offer sick leave, then it may be discriminating against pregnant workers. “( Child Labor Laws. (n.d.) Employers have to treat a women just like the rest of the employees and a employer has to respect the person who is pregnant. They can't deny her benefits or fire her because of her situation.


The Civil Rights Act of 1964 was violated under the Apple company because they allowed their supplier to make the children and women take pregnancy tests, and if they were pregnant they were not allowed to work at the facility. This is a violation of rights because the Civil Rights Act states that you can't refuse a women the right to work just because she is pregnant, as long as she is able to work toy can't discriminate against her because she is pregnant. This is what happened under Apple's watchful eye. You can not tell underage children and women that they have to take a mandatory pregnancy tests, and if they are pregnant they can't work for your company.

“That section 701 of the Civil Rights Act of 1964 is amended by adding at the end thereof the following new subsection: (k) The terms 'because of sex' or 'on the basis of sex' include, but are not limited to, because of or on the basis of pregnancy, childbirth, or related medical conditions; and women affected by pregnancy, childbirth, or related medical conditions shall be treated the same for all employment-related purposes. (The Pregnancy Discrimination Act. (n.d.)

“This subsection shall not require an employer to pay for health insurance benefits for abortion, except where the life of the mother would be endangered if the fetus were carried to term, or except where medical complications have arisen from an abortion: Provided, That nothing herein shall preclude an employer from providing abortion benefits or otherwise affect bargaining agreements in regard to abortion.” (The Pregnancy Discrimination Act. (n.d.)

It is important not to violate laws of any kind, it is also important to learn how to protect yourself as a business, and how to reduce your liability in case a problem arises. A liability means that you are bound by the law to complete a action that the court can force on your company. Basically it is


the probable cost of meeting a legal obligation. Depending upon the context of the liability, the obligation may take on different forms. Liability losses are the amount of money an organization must spend to respond to actual claims brought against it. These losses may include compensatory or punitive damages as the result of personal injury or property damage claims brought against an organization by employees or the public. Even if the organization is not responsible for any legal wrong, liability losses (monetary) may be incurred in defense of a claim brought against the entity or individual employees.

“In general, liability exposures may be prevented by avoiding activities that give rise to that liability. Avoiding liabilities may be possible in certain situations, but is not feasible or practical for many agency operations. Specific activities may expose the individual and the organization to liability. The expected value of liability losses should be evaluated to determine if the liability exceeds the expected benefit of engaging in a particular activity.” (The State Office of Risk Management. (n.d.)

Apple's supplier could have avoided their liability exposure by not hiring the minors because they are liabilities themselves. Then they could have reduced their risks by not making false promises in the contract for the minors which is called contract liability. They also could have had the minors in a safe area in their facility and this is called criminal liability, because anything such as bodily harm could have happened to the children. They also could have followed the guidelines in the Civil Rights Act, and not required pregnancy tests before employment, this is called statutory liability.

Reducing your liability is essential to running a business but as a organization you also need to

improve your ethical climate in the organization as well. You have to give employees power, and a code of ethical conduct to follow. If they don't feel like they can make decisions they will not feel trusted in 11

your organization. If they don't fell trusted they are not going to do their best work, because they will feel like they are not valued in your organization. In Apple's case they gave too much power to the supply company and that's why they didn't know that the children were hired.

Communication is another way you can can improve the overall ethical climate. If you can get your managers to communicate the ethical policies correctly, the employees would know how to communicate and make the correct decisions based on the conversation. In Apple's case the adult workers were to scared in the beginning to blow the whistle, and that is why Apple did not find out until years later, about the violation of the child care laws.

Discipline is another way to improve the overall ethical climate, you need to give employees consequences, if they violate a policy they have to have a consequence, this is to let them know that either they follow the rules or they are fired. Apple never told the suppliers not to hire children, there was no mention of that in the contract, and when Apple found out they did not even fire all of the suppliers who violated the child care laws, they only fired one company.

The final way to change a organizations ethical climate is to change, if you see that certain policies or procedures no longer work you have to change them to keep up with employees. The same old policies might not work today like they did yesterday. In the case of Apple they only changes their policies after they found out about the underage children being employed. If the change was in the contract ahead of time, they could have taken their supply company to court.

“As you look at employee behaviors and enforce your ethics policy, you might see patterns of unethical behavior. This might indicate that some rules and procedures need to be changed in the


organization, even it affects ways of doing things that save time or money or increase profits. From a business standpoint, the short-term losses should be outweighed by the resulting improvement in the long-term reputation of your business.” ( (n.d.)

“In the end the investigators found 90 facilities that deducted wages to punish workers,

prompting Apple to order the reimbursement of employees. Mandatory pregnancy testing was found at 34 places of work, while 25 tested for medical conditions such as hepatitis B. At four facilities, payroll records were falsified to hide information from auditors” (The Guardian. (n.d.)

Forms of child labor, including indentured servitude and child slavery, have existed throughout American history. As industrialization moved workers from farms and home workshops into urban areas and factory work, children were often preferred, because factory owners viewed them as more manageable, cheaper, and less likely to strike. Growing opposition to child labor in the North caused many factories to move to the South. By 1900, states varied considerably in whether they had child labor standards and in their content and degree of enforcement. By then, American children worked in large numbers in mines, glass factories, textiles, agriculture, canneries, home industries, and as newsboys, messengers, bootblacks, and peddlers.

Here is the evidence on child labor and the time line on how it came about. There are an estimated 186 million child laborers worldwide, the 2001 the estimated total number of child labor aged 5–14 to be at 12.6 million, in 2008, some 60% of the 215 million boys and girls were estimated to be child laborers worldwide. In 1836 the first state child labor law Massachusetts requires children under 15 working in factories to attend school at least 3 months/year. 1881 Newly formed AFL supports state minimum age laws. The first national convention of the American Federation of Labor 13

passes a resolution calling on states to ban children under 14 from all gainful employment. In 1904 National Child Labor Committee forms Aggressive national campaign for federal child labor law reform begins. (The Child Labor Education Project. (n.d.)

“In 1916 New federal law sanctions state violators first federal child labor law prohibits movement of goods across state lines if minimum age laws are violated (law in effect only until 1918, when it’s declared unconstitutional, then revised, passed, and declared unconstitutional again.) In 1936 Federal purchasing law passes Walsh-Healey Act states U.S. government will not purchase goods made by underage children. (The Child Labor Education Project. (n.d.)

Employers have always capitalized in underdeveloped countries where they know that laborers cannot legally form unions, (The Child Labor Education Project. (n.d.) This does not make it morally or ethically right for companies to exploit children in poor rural areas. If laws are not forced, then child slavery will continue and these children will be deprived of the simple joys of childhood.

14 References

Seaquist, G, Business Law for Managers, 2012, San Diego, CA: Bridgepoint Education.

Apel, R., Bushway, S. D., Paternoster, R., Brame, R., & Sweeten, G. (2008). Using state child labor laws to identify the causal effect of youth employment on deviant behavior and academic achievement. Journal of quantitative criminology, 24(4), 337-362.

Baland, J. M., & Robinson, J. A. (2000). Is child labor inefficient?. journal of Political Economy, 108(4), 663-679.

Basu, K. (1999). Child labor: cause, consequence, and cure, with remarks on international labor standards. Journal of Economic literature, 1083-1119.

Chapter 1 Liability Exposures – Overview | The State Office of Risk Management. (n.d.). Retrieved from

Child labour uncovered in Apple's supply chain | Technology | The Guardian. (n.d.). Retrieved from

Child Labor in U.S. History - The Child Labor Education Project. (n.d.). Retrieved from

Grootaert, C., & Patrinos, H. A. (Eds.). (1999). The policy analysis of child labor: A comparative study. Macmillan.

Lefebvre, A. A. (1924). Child Labor Laws. Bi-Monthly L. Rev., 8, 1.

Lleras-Muney, A. (2001). Were compulsory attendance and child labor laws effective? An analysis from 1915 to 1939 (No. w8563). National bureau of economic research.

Marlenga, B., Berg, R. L., Linneman, J. G., Brison, R. J., & Pickett, W. (2007). Changing the child labor laws for agriculture: impact on injury. American journal of public health, 97(2).

Moehling, C. M. (1999). State child labor laws and the decline of child labor. Explorations in Economic History, 36(1), 72-106.

Moral & Ethical Issues in the Workplace: Child Labor. (n.d.). Retrieved from

Occupational Safety and Health Act (OSHA). (n.d.). Retrieved from

Principles and Theories. (n.d.). Retrieved from

The Pregnancy Discrimination Act. (n.d.). Retrieved from

Pregnancy Discrimination - Know Your Rights. (n.d.). Retrieved from

Tyler, J. H. (2003). Using State Child Labor Laws to Identify the Effect of School‐Year Work on High School Achievement. Journal of Labor Economics, 21(2), 381-408.

Ways to Improve an Organization's Ethical Climate | (n.d.). Retrieved from

Weiner, M. (1991). The child and the state in India: Child labor and education policy in comparative perspective. Princeton University Press.

Youth Worker Safety in Restaurants eTool | Resources - Child Labor Laws. (n.d.). Retrieved from

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...Sec 14 4th January 2012 Child Labor Is Child Labor Acceptable in Pakistan? Child labor is a global phenomenon that is defined as the children working under the age of 14 or 16 years. While most of the developed world has been able to overcome with this so-called social evil, child labor has been prevailing in almost all of the developing countries. The International Labor Organization (ILO) and Human Rights Organizations have been active in eliminating the practice of child labor through the agreement on the protection of the rights of children and the labor. The issue of child labor came into consideration in Pakistan when most of the European countries in 1990s declared a boycott on the goods exported by developing countries that involved child labor. As a result, child labor laws were passed in Pakistan in 1991 which banned child labor in certain manufacturing sectors. According to Federal Bureau of Statistics, a survey funded by IPEC (International Program on the Elimination of Child Labor) showed that in 2010, the working children in Pakistan numbered to 3.8 million (Arshad n.p). Although it is argued that child labor deprives children from education and leads to immoral acts such as exploitation and child abuse, it can be justified in Pakistan considering the current economic situation and educational infrastructure in the country and because it could give some economic and social benefits to the nation; therefore, the ban against child labor may have drastic......

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