Apple responded to claims that its Shanghai-based manufacturer, Pegatron, was involved in labor abuses. According to the report compiled by China Labor Watch, Pegatron was supposedly forcing staff to work overtime without pay. Also, the report, entitled Apple's Unkept Promises, claimed that living and working conditions were substandard.

"China Labor Watch's investigations revealed at least 86 labour rights violations, including 36 legal violations and 50 ethical violations," claimed the organization. In addition, staff were purportedly paid US$1.50 to produce the upcoming iPhone C, which was a low-cost version of the iPhone. Shanghai's minimum wages were CNY14 per hour and CNY1,620 per month.

However, according to a statement by Apple, regular audits were conducted in Pegatron since 2007. "Apple is committed to providing safe and fair working conditions throughout our supply chain. We lead the industry with far-reaching and specialized audits, the most transparent reporting and educational programs that enrich the lives of workers who make our products. Apple is the first and only technology company to be admitted to the Fair Labor Association, and we are dedicated to protecting every worker in our supply chain," added the company.

Pegatron is a Taiwanese electronics company that manufactures computing, communications, and consumer electronics to Apple and other branded vendors. In 2012, its estimated revenue amounted to TWD768.1 billion, with annual earnings pegged at TWD2.71 per share, according to Businessweek.com.