Apple is running into labor problems again. This time thought, it’s not Foxconn but Pegatron which has been accused of labor violations by China Labor Watch whose workers went undercover. Report from TNW brings us this detail.

But in the wake of these revelations, we also find two most-sought-after news items that are of interest to market watchers. We take a look at the promise of the “iPhone 5C”, the budget iPhone and the labor issues that Apple runs into due to its partners.

The iPhone “5C” made headlines a couple of days ago when photos of the packaging containing the very words were leaked. Now, two days later, iPhone 5C re-appears in a report from China Labor Watch. The report focuses on the working conditions at Pegatron, one of Apple’s leading iPhone unit makers now.

iPhone 5C Rumors

First, the news about what’s happening at Pegatron because everyone seems to have conveniently forgotten that in the wake of “more interesting” iPhones.

China Labor Watch sent undercover investigators into three factories to find out the exact working conditions for the laborers. As expected and like Foxconn, Pegatron has been accused of bad working conditions and treatment. While the pay is enormously low already, the conditions under which the laborers work to assemble Apple’s legendary iPhone are quite bad according to the report.

One of the undercover investigators notes:

Today’s work is to paste protective film on the iPhone’s plastic back cover to prevent it from being scratched on assembly lines. This iPhone model with a plastic cover will soon be released on the market by Apple.

The new cell phone has not yet been put into mass production, so quantity is not as important. This makes our job more slow-paced than in departments that have begun mass production schedules.”

So this leads us to the iPhone 5C rumor.

While iPhone 5C features are as yet unclear, we’ve got a plastic body with reduced specs that would make the iPhone 5C affordable to people who’re ready to shell out about $300 (unlocked). There are also speculations that the iPhone 5C price would fall in the $99 – $149 range but I think that’s the contract-version.

The iPhone 5C release date, according to a post from PhoneArena, is September 18. While the new iPhones will be announced on that date, the expected launch into the market is September 27th.

As for “C”, let’s just not go into the speculation now. It’s probably ‘Color’.