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Foxconn has apologized for pay-related errors at its China iPhone plant after worker discontent

Foxconn has apologized for pay-related errors at its China iPhone plant after worker discontent
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  • Foxconn said it was working with workers to resolve the dispute
  • A major iPhone factory was rocked by protests over pay, conditions
  • Apple says it has teams in Zhengzhou

TAIPEI/SHANGHAI, Nov 24 (Reuters) – Foxconn (2317.TW) A Covid-hit iPhone factory in China said on Thursday that a pay-related “technical error” had occurred during the hiring of new hires, and the company apologized to workers rocked by fresh labor unrest.

The men broke surveillance cameras and clashed with security personnel as hundreds of workers protested On Wednesday at the world’s largest iPhone plant in the city of Zhengzhou, a rare scene of open dissent in China sparked frustration over demands for higher wages and severe COVID-19 restrictions.

Employees said in videos circulated on social media that they were informed that Apple Inc. (AAPL.O) Supplier intends to delay bonus payments. Some workers complained that they were forced to share dormitories with colleagues who tested positive for COVID.

“Our team is looking into the matter and discovered a technical error during the onboarding process,” Foxconn said in a statement referring to the hiring of new employees.

“We apologize for an input error in the computer system and guarantee that the actual salary is agreeable and same as the official recruitment posters.” It did not elaborate on the error.

The apology was a mask from when Foxconn said it had met its payment agreements a day earlier.

The rest comes at a time when China is logging Record number of COVID-19 infections And grappling with more and more lockdowns that have fueled frustration among citizens across the country. But it also revealed communication problems among some workers and mistrust of Foxconn management.

The largest protest has ended and the company is contacting workers engaged in smaller protests, a Foxconn source familiar with the matter told Reuters on Thursday.

The person said the company had reached a “preliminary agreement” with workers to resolve the dispute and production at the plant was continuing.

Workers’ discontent over the Covid outbreak, strict quarantine rules and food shortages have seen many employees flee the closed factory campus since October when management implemented a so-called closed-loop system that isolated the plant from the wider world.

Many new recruits were hired to replace those who fled—some former workers estimate thousands.

The Taiwanese company said it will respect the wishes of new hires who want to resign and leave the factory campus and will provide them with “care subsidies”. Foxconn sources said the subsidy is 10,000 yuan ($1,400) per worker.

Apple risk

The Foxconn logo is seen on a glass door of an office building in Taipei, Taiwan, Nov. 12, 2020. REUTERS/An Wang

Home to more than 200,000 workers, Foxconn’s Zhengzhou plant includes dormitories, restaurants, basketball courts and a soccer pitch across a sprawling facility of about 1.4 million square meters.

The factory makes Apple devices including the iPhone 14 Pro and Pro Max and accounts for 70% of iPhone shipments worldwide.

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Apple said it has workers at the factory and is “working closely with Foxconn to ensure their workers’ concerns are resolved”.

Several shareholder activists told Reuters the protests showed the risks Apple faces by relying on manufacturing in China.

“Apple’s extreme reliance on China, both as a (consumer) market and as a primary manufacturing location, we see as a very risky situation,” said Christina O’Connell, senior manager at SumOfUs, a nonprofit corporate accountability group.

Reuters reported last month that iPhone output at the Zhengzhou factory could drop by as much as 30% in November, and that Foxconn aims to resume full production there in the second half of the month.

Foxconn sources familiar with the matter said it was not immediately clear how much the labor strike could affect November production and that it could take days to work out, citing the large size of the factory.

A separate source said the unregulated have confirmed that they will not be able to resume full production by the end of the month.

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Apple has warned that it expects lower shipments of premium iPhone 14 models than previously expected.

Reuters graphics

($1 = 7.1353 Chinese Yuan)

Reporting by Imyu Li in Taipei and Brenda Goh in Shanghai; Additional reporting by Ross Kerber in Boston, Beijing Newsroom and Yu Lun Tian; Edited by Anne Marie Rowentry, Stephen Coates and Edwina Gibbs

Our values: Thomson Reuters Trust Policy.

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