Apple to face worker complaints after unrest at China’s iPhone factory

HONG KONG — Apple Inc.

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said it was working to resolve worker complaints at the world’s largest iPhone factory in China after police were filmed beating protesting workers at the plant this week and workers began a walkout Thursday.

Labor groups have criticized Apple for failing to adequately protect the rights of workers at the huge Zhengzhou site operated by Foxconn 2317 0.50%

Technology Group and where most iPhone 14 models in the world are manufactured. Workers clashed with police on Tuesday, angry over delayed bonus payments and conditions at the factory, which has been battling the Covid-19 outbreak for more than a month.

Apple said in a statement that it has staff at the Zhengzhou site and is working closely with Foxconn to ensure its workers’ concerns are addressed.

Foxconn on Thursday blamed “an input error in the computer system” that occurred during the onboarding process, which resulted in new hires receiving contracts meant for existing workers. The company said it guarantees that recruits will be paid what was agreed and according to the official recruitment posters.

Footage shows police in Covid protective suits beating workers at the Foxconn facility in Zhengzhou, China. The world’s largest site that makes Apple smartphones has been on lockdown for the past few weeks due to Covid-19. Screenshot: Associated Press

Foxconn also offered a payment of 10,000 yuan, the equivalent of $1,400, to newly hired workers who wanted to quit their jobs and return home, according to text messages sent by the company’s human resources department and shown to Wall Street workers. Journal.

Many workers accepted the offer and waited in long lines with their luggage before boarding buses to leave the factory on Thursday morning, according to several live video streams from the website. One worker told the Journal he was among a large crowd of people who waited more than an hour to board a company bus that dropped him and his colleagues off at a train station, adding that he had received the first installment of the payment.

The latest worker exodus adds to pressure on Apple’s iPhone 14 production, with the company saying earlier this week that shipments of the high-end iPhone models would be lower than expected due to factory shutdowns from the recent Covid-19 outbreak. .

Staff shortages in Zhengzhou caused by recent Covid cases, even before this week’s unrest, could have about a 10% impact on global iPhone production capacity, according to TF International Securities analyst Ming-Chi Kuo which follows Apple’s supply chain. Apple’s chief financial officer said in October that supply is limited for the new iPhone 14 Pro models amid strong demand.

One person was arrested by security personnel during Wednesday’s protest at Foxconn’s iPhone factory in Zhengzhou, China.


Photo:

/Associated Press

Despite the economic slowdown, demand for high-end phones such as the iPhone 14 Pro and Pro Max models—mostly manufactured at Foxconn’s Zhengzhou site—is more resilient than for lower-end phones. Production disruptions this year linked to China’s Covid policies have prompted Apple to try to boost production capacity outside China, particularly in India and Vietnam, the Wall Street Journal reported.

Apple also tried to ramp up iPhone14 production at other locations in China after the Covid outbreak in Zhengzhou.

The violent clashes at the Zhengzhou factory marked new ground in Apple’s history of making most of its products in China, where it relies on cheap labor and well-developed component supply chains to produce smartphones and other electronic devices that have prompted it to become among the most valuable public companies in the world. Foxconn and other manufacturers continued to operate under China’s strict zero-Covid policies under closed-loop systems that keep workers living and working in bubbles to reduce the potential spread of infections.

Production at the sprawling factory housing more than 200,000 workers was halted when a Covid outbreak initially saw the company keep hordes of workers confined to empty apartment blocks or their accommodation near the construction site.

As Foxconn tightened Covid restrictions to keep assembly lines turned to meet Apple’s production demands, it saw thousands of workers flee in a walkout for fear of contracting the disease and amid rumors that infected people were being allowed to work so that the company can achieve its goals.

The uprising by recruits who joined thousands who walked off the job at the Zhengzhou factory showed that the smartphone maker had failed to live up to its responsibilities as a global leader at the top of the supply chain when its suppliers violated workers’ human rights, the Aiden. Chow, a researcher at the labor rights group China Labor Bulletin.

Apple has warned that shipments of its high-end iPhone models will be lower than expected due to the Covid shutdown at the Foxconn factory.


Photo:

Andy Wong/Associated Press

“It’s unbelievable that police had to be deployed to get people back to work,” Mr Chow said.

The Zhengzhou government this week said the city would remain largely on lockdown for five days starting Friday. Foxconn began operating a closed-loop system in mid-October, with workers only able to move between their accommodations and production lines.

Videos circulating on worker chat groups and social media on Wednesday showed chaotic scenes as workers took to the streets in various areas within the sprawling manufacturing complex. The protests were sparked after some newly hired workers received contracts that indicated bonus payments would be released later than promised upon hiring.

Workers who now want to leave the Zhengzhou factory have been asked to register using an online form and will receive their exit payment in two installments, before and after they board the vehicles home arranged by the government, Foxconn’s text message said. The fee would cover wages, transportation and quarantine costs, he said.

—Wenxin Fan contributed to this article.

Write to Selina Cheng at [email protected] and Yang Jie at [email protected]

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