Apple, Dell, HP Comment on Foxconn Suicides

**gunnut** · 28 May 10,, 01:28

Apple, Dell, HP Comment on Foxconn Suicides

8:10 PM - May 27, 2010 by Jane McEntegart - source: Tom's Hardware US

A lot of computer companies outsource work to Foxconn and given the recent news reports regarding the assembly plant, some of the bigger names are eager to make their opinions on the matter heard.

HP, Apple and Dell have all released statements offering condolences as well and say they are looking into the matter. Apple's Steve Dowling told Bloomberg that the Cupertino-based company was "saddened and upset" by the suicides.

"We are saddened and upset by the recent suicides at Foxconn. We're in direct contact with Foxconn senior management and we believe they are taking this matter very seriously. A team from Apple is independently evaluating the steps they are taking to address these tragic events and we will continue our ongoing inspections of the facilities where our products are made."

Dell has offered a similar statement and said the company expects Foxconn to employ the same standards Dell does in its own factory.

"We expect our suppliers to employ the same high standards we do in our own facilities. We enforce these standards through a variety of tools, including the Electronics Industry code of conduct, business reviews with suppliers, self-assessments and audits."

Further word from a spokesperson reveals Dell is also investigating the situation.

"Any reports of poor working conditions in Dell’s supply chain are investigated," Jess Blackburn, a spokesman for Dell, said in an email to Bloomberg. "We expect our suppliers to employ the same high standards we do."

HP is also investigating "the Foxconn practices that may be associated with these tragic events."

The news comes as reports suggest the number of suicides at the Foxconn factory has risen to 15.

Apple, Dell, HP Comment on Foxconn Suicides

I have not seen this matter posted here.

Foxconn is a major contractor in computer industry. It manufactures computers for HP, Dell, and Apple. That's right, your iPad and iPhone are not made by Apple, but by Foxconn.

I've heard from Chinese sources that claimed the recent rash of suicides might have something to do with the company's generous compensation for the victims' families. Supposedly the company pays the victim's family 350,000 RMB as compensation for the death.

Any thoughts?

**xinhui** · 28 May 10,, 04:52

First of all, my condolences to the family, I know how hard it is to make a good living. There is room for improvement and they should be held to a higher standard because they are making stuff for the best known names in the business.

After saying that foxconn has 900,000 employees, In any city of 900,000. 10 to 15 suicides rate per year is not a crisis. I am sure some depressed individual would consider death with 350,000 RMB to the family as a way out.

Apple iPhone maker Foxconn reportedly asked workers to sign no-suicide pledge

Suicide

* In 2006, 33,300 (approximately 11 per 100,000) people died by suicide in the U.S.7
* More than 90 percent of people who kill themselves have a diagnosable mental disorder, most commonly a depressive disorder or a substance abuse disorder.8
* The highest suicide rates in the U.S. are found in white men over age 85.9
* Four times as many men as women die by suicide9; however, women attempt suicide two to three times as often as men.10

NIMH · The Numbers Count: Mental Disorders in America

**RollingWave** · 28 May 10,, 11:09

Foxconn is the crown jewel of Taiwan enterprises, it's run by the most famous Taiwan busniessman (Guo Tai Ming) and almost all of it's senior managment are from Taiwan, so suffice to say that it's pretty big news here.

Is the work there tough? yeah, but the work condition and rules there have always been regarded to be well above the average Chinese factories.

It's a really messy situation though, that's for sure. Guo has basically spend the last few days over there (and he's got factories in MANY places.) hoping to try to quall the crisis. I suggest that for now he should just station at least 2 guards on every damn roof 24/7.

But really, the dude has 900,000 employees, that's amazing, a bunch of countries don't even have that many people.

**kyli** · 28 May 10,, 14:42

The working conditions of Foxconn does surpass majority of average Chinese factories; however, Foxcoon is known for its strictness. Workers have been operating at a very oppressed environment. I believe some of the strictions such as employees' restroom time, no conversation, and restriction of movement might go too far.

I understand Foxconn puts in place these rules and restrictions in order to remain competitive and mantain efficiencies. However, it might have overlooked that its workers are mostly 18 to 30 years young adults. They need to socialize especially as they are living at a city that is thousands miles from their home and in an environment with strangers. The 60s or 70s generation might have been through tougher time at early age, but these late 80s and early 90s generation are not. We need to take into consideration of these children's endurance.

Lastly, Taiwanese and Korean factores' reputation in China are rather low. Mainland Chinese rates working conditions of factories in the order of following: US, EU, Japan, Hong Kong, Mainland, Taiwan, and Korea. I agree that 10 to 15 suicides rate per year in a city of 400, 000 employees should not consider as a crisis, but it does signal a problem.

**xinhui** · 28 May 10,, 17:33

Foxconn to raise factory wages by 20%

By Kathrin Hille in Beijing

oxconn, which assembles and makes parts for major electronics brands, has about 20 manufacturing bases employing a total of 800,000 people all over China.

Some of Foxconn's top customers have said they were looking into working conditions at the manufacturer in response to the spate of suicides.

essure and social isolation have raised the risk of suicides among the workers.

Management and workers at Foxconn's Longhua manufacturing complex said the company had been considering a pay rise for several months.

t most of them make at least double that amount through constant overtime.

base monthly salary for Foxconn's production workers at the Longhua plant is Rmb950 ($140), but staff interviewed by the Financial Times said they were making almost Rmb2,000 a month including overtime.

**gunnut** · 28 May 10,, 19:57

Originally Posted by xinhui

Foxconn to raise factory wages by 20%

By Kathrin Hille in Beijing

oxconn, which assembles and makes parts for major electronics brands, has about 20 manufacturing bases employing a total of 800,000 people all over China.

Some of Foxconn's top customers have said they were looking into working conditions at the manufacturer in response to the spate of suicides.

essure and social isolation have raised the risk of suicides among the workers.

Management and workers at Foxconn's Longhua manufacturing complex said the company had been considering a pay rise for several months.

t most of them make at least double that amount through constant overtime.

base monthly salary for Foxconn's production workers at the Longhua plant is Rmb950 ($140), but staff interviewed by the Financial Times said they were making almost Rmb2,000 a month including overtime.

Sometimes pay is not what matters. Sometimes the little things at the work place will go farther to improve morale than extra 20% pay. Extend break time; free beverages and maybe discount snacks; less strict environment. These things may combine to cost 20% of the pay, but I bet they can improve the morale by more than 20%.

**cr9527** · 31 May 10,, 09:08

Originally Posted by kyli

I agree that 10 to 15 suicides rate per year in a city of 400, 000 employees should not consider as a crisis, but it does signal a problem.

How would it be a problem? thats 2.5-3.75 deaths per 100,000 people per year. Even well developed countries have trouble keeping it below 5.
US and Canada for example is at ~11.

**kyli** · 31 May 10,, 15:25

It is a problem because every suicide triggers more suicides which indicates that there are suicidal tendencies within some of the employees.

Anyway most of the workers agree that Foxcoon pays better, but they also express that Foxcoon is extremely strict. Understandly, Foxcoon is only trying to operate at a most efficient environment, but human is a social creature. All of us have limitation, and I believe Foxcoon corporation's model might come to close to this red line. It is similar to the Ford corporation in its early day when Henry Ford pays his workers generously, but there are high frenqency of suicides in his plant.

**cr9527** · 31 May 10,, 17:28

Originally Posted by kyli

It is a problem because every suicide triggers more suicides which indicates that there are suicidal tendencies within some of the employees.

Anyway most of the workers agree that Foxcoon pays better, but they also express that Foxcoon is extremely strict. Understandly, Foxcoon is only trying to operate at a most efficient environment, but human is a social creature. All of us have limitation, and I believe Foxcoon corporation's model might come to close to this red line. It is similar to the Ford corporation in its early day when Henry Ford pays his workers generously, but there are high frenqency of suicides in his plant.

In every society of this size, there are this many suicides, and MORE. Yet you don't seem to be complaining about chain reactions occuring there do you?
Plus, every modern factory is strict and filled with repetative work. I fail to see the problems with foxconn

**kyli** · 31 May 10,, 20:53

Firstly, these recent suicides only just have occurred within the last six month or so. We don't have the full year rate yet, and the frequency has increased in the last couple of months.

Secondly, we are only counting the suicides that are occurred within the Foxcoon's facility and factory.

Thirdly, All modern factories are strict, but Foxcoon has many practices that are not very humanistic. I have mentioned a few already.

Lastly, Foxcoon has the capability to improve these workers' condition and reduce its workers' stresses and pressure. Foxcoon also acknowledges that it has to do something, and it recently just announces that it would hike the wages by twenty percent.

P.S. Some practices and treatment of workers might be perfectly ok in the past, but as the society progresses things change. The 80s and 90s are very different from the 60s and 70s generation. If Foxcoon does not change its method of management, the suicides would only go up. I am not accusing Foxcoon for wrongdoings, but I want to state that Foxcoon needs to adapt in the changing world.

**kyli** · 02 Jun 10,, 21:51

Hon Hai Group to Raise Wages by at Least 30 Percent (Update2) - Bloomberg.com

on Hai Group to Raise Wages by at Least 30 Percent (Update2)

By Weiyi Lim

June 2 (Bloomberg) -- Hon Hai Group, the assembler of Apple Inc.’s iPhones, will raise workers’ salaries by at least 30 percent, more than indicated earlier, after a series of suicides at the world’s largest contract manufacturer of electronics.

Workers with a monthly wage of 900 yuan ($131.77) will be paid 1,200 yuan effective immediately, said Edmund Ding, a spokesman at the Taipei-based flagship company Hon Hai Precision Industry Co. The increase was reported earlier by the Economic Daily News. Hon Hai, also known as Foxconn Technology Group, said on May 28 it might raise pay in China by 20 percent.

“It’s been a while since we increased wages, hence the decision,” Ding said today by phone. “Raising pay and the suicide issues are two separate matters,” he said when asked if the move will reduce suicides at Hon Hai.

Higher wages may help Hon Hai offset negative publicity generated after the worker deaths at its China factories this year, according to Steven Tseng, an analyst at RBS Asia Ltd. Rights group China Labor Watch said wages that are too low to cover the cost of living have put pressure on Hon Hai factory workers, who are “exhausted.” Hon Hai chairman Terry Gou has rejected allegations the company is a sweatshop.

“It’s hard to assess if the wage rise will stop the suicides, maybe it will help get rid of this negative publicity,” Taipei-based Tseng, who rates Hon Hai Precision “buy,” said by phone today. The increase, which is higher than Tseng expected, could cut net income this year by up to 6 percent, he said. “They may be able to pass on some of the costs to clients.”

‘Worst-Case Scenario’

Morgan Stanley analyst Jasmine Lu wrote in a report yesterday that Hon Hai Precision’s net income for this year may be cut by 7 percent under a “worse-case scenario” if the company increased workers’ salaries by 20 percent. Citigroup Inc. in a May 27 report estimated a 20 percent rise may erode operating profit by 10 percent to 11 percent, and reduced its 2010 earnings estimate for Hon Hai by 11 percent.

Hon Hai dropped to its lowest level in more than eight months in Taipei trading. The stock was 0.8 percent lower at NT$123.5 as of 10:30 a.m. local time.

The shares have declined 17 percent since May 1, compared with a 9.3 percent slump in the benchmark Taiex index. Five of the 10 deaths at the company occurred during May.

‘Great Pressure’

At least 10 people have died this year at Hon Hai’s manufacturing complex in Shenzhen and police are treating the deaths as suicides, prompting Gou to recruit counselors and install nets on dormitory buildings.

The minimum monthly wage in Shenzhen is between 900 yuan and 1,000 yuan, according to the city government.

Hon Hai “workers have no choice but to work massive amounts of overtime to support themselves and their families, and are always, as workers in the computer production department stated, ‘extremely exhausted,’ and under ‘great pressure,’” Li Qiang, founder and executive director of New York-based China Labor Watch said last week.

Hon Hai’s pay raise follows Honda Motor Co., Japan’s second largest carmaker, resuming production at a parts plant after workers walked out last week demanding higher wages. Most of the parts factory’s 1,900 workers accepted a pay offer of up to 1,910 yuan a month, according to Honda. The employees had demanded between 2,000 yuan and 2,500 yuan.

“It’s not just Hon Hai’s problem -- it’s everyone’s problems,” Calvin Huang, an analyst at Daiwa Securities Group Ltd., said by phone. “If others don’t follow suit and raise wages, they will face suicides or strikes like that at Honda.”

Apple, Hewlett-Packard Co. and Dell Inc. said last week they are probing Hon Hai following the deaths. Apple has a team evaluating Hon Hai’s countermeasures, it said.

The Shenzhen police are examining the suicides, Li Ping, a spokesman for the municipal government in the southern Chinese city, said May 27. Wang Rong, Communist Party secretary of Shenzhen Municipal Committee, other city officials and labor union officials went to the plant on May 26 to investigate, the government said in a statement on its website May 27.

**Triple C** · 03 Jun 10,, 08:42

kyli,

Thank you for your thoughtful response. For awhile I have been puzzled about why some Chinese seem to strongly dislike Taiwan for reasons other than politics. For example there was a chain mail about Taiwanese businessmen eating Chinese babies. The unfortunate events confirmed my suspicions that this has something to do with factory owners.

An American friend in Beijing told me that according to what she had heard, in terms of working conditions the Chinese laborors rate western factories as the best, Japanese/Taiwanese factories not as good, and Chinese factories the worst. Regardless of whose factory is slightly better, those events are unsettling. The compensation paid to the suicide's family amount to 10 years worth of salary--in other words those workers are worth more dead than alive.

I am going to take it as a given that working conditions had not changed much from, say, last year or the year before that; in circa 2003 I read from the NYT about those kind of things--suicides, escape attempts, etc. Can you provide an explanation or a guess as to why this haven't happened sooner rather than later?

Btw, by humanistic I presume you mean humane. :p English is a tricky language.

**kyli** · 03 Jun 10,, 21:25

Tricky or not, I would never be proficient in English

. I still remember all the grammatical and mechanical errors that I had made and all the revisions that I had done for english 101 and 102, eventually my english professors had taken pity on me and given me an A but I vowed not to take any advanced English course.

In the early days of Deng's reform and opening up, the Chinese people had just been through hell. They just wanted a better life. For them, the harsh and horrible working conditions were just a secondary concern. The foremost concern was to have a job. I mean in the eighty and early ninety a doctor only earned about one or two hundred yuan a year, but a factory worker in Shenzhen could probably earn more.

When I went to China with my parents in the eighty, there were hundreds of beggers in the street. These were all the unemployed workers or farmers who were looking for jobs. The supply of laborers excessed the demand of laborers by a wide margin. There were no bargaining powers for these workers. There were workers who committed suicides, who got beating up, who got rape, and who didn't receive any paid. However, nobody cares because the government wanted these jobs and the workers needed these jobs. The government even outlawed strike in order to lure investment. Therefore, these factory could almost get away with anything.

In the late 90s, the Asian financial crisis and the meltdown in the state owned firms were bigger concerns. What happened in Shenzhen or Canton is plain in comparison with the Northeast, the deadly clashes and strikes in these state firms overshadowed the problems in the south.

In the beginning of the new century, the internet revolutionized the flow of information. CCP no longer had the capability to control information that it once had enjoyed in the 1998. It could no longer silence the news media or the people about its or the society's problems.

Few years ago, there were workers who petition in front of Wen because they could't collect their paid and unable to travel back home. Last couple years, there were many Koreans and Taiwanese firms just closed down and their owners fleed. As long as they can make it back to Korea or Taiwan, nobody would do anything to them. In the end these workers demonstrated, and the Shenzhen and many of the city government were forced to pay these workers. I believe these Taiwanese and Koreans owners have created a very bad image of the Taiwanese and Koreans. A difficult and strict working conditions is one thing, but leaving thousands and thousands of workers without paid is beyond acceptance.

I guess the mainland Chinese have just become more intolerant of these problems; therefore, there are a sudden spike of backlash. Foxcoon is just caught between the struggle of laborers and factory owners, eventhough Foxcoon probably has a better working environment than most but its sheer side has magnified its shortcoming and backlash.

Your friend is right to say that Western firms are better than Japanese firms and Japanese firms are better than Taiwan and Koreans' firms. The Taiwanese firms are better than Mainland firms with the exception of state owned firms and big Chinese corporations. Of course the legacy of "inefficiency" of the state owned firms is one of the reasons for their better working conditions.

I guess freedom comes at a cost. CCP could no longer sacrifice the well beings of the workers for industrialization at least not as easier as it had been doing. I just hope the workers are only demanding their fair share because these jobs are still vital for China. The workers should try to change the working conditions but without scaring the factroy away. Eventhough the supply of the laborers are more in the workers' favor nowadays as more and more people chose to stay at their owned province to get factroy and construction jobs, these factory in the south and east still provide million of jobs that are essential for the mainland Chinese.

**Bigfella** · 06 Jun 10,, 01:22

Originally Posted by kyli

It is a problem because every suicide triggers more suicides which indicates that there are suicidal tendencies within some of the employees.

Anyway most of the workers agree that Foxcoon pays better, but they also express that Foxcoon is extremely strict. Understandly, Foxcoon is only trying to operate at a most efficient environment, but human is a social creature. All of us have limitation, and I believe Foxcoon corporation's model might come to close to this red line. It is similar to the Ford corporation in its early day when Henry Ford pays his workers generously, but there are high frenqency of suicides in his plant.

Kyli,

I think your reference to Henry Ford actually hits the nail on the head. Having heard a few descriptions of conditions in Foxconn it is clear that the managers there are devotees of some variation of 'Taylorism', a system of making workers more efficient that had followers as diverse as Ford, Lenin & Trotsky. While methods like 'time in motion' studies do increase work efficiency, it is often at the expense of worker morale. This can happen even when the jobs in question are higher paid.

Such methods were still in fashion in the Western world into the 1970s, but have been abandoned since for methods that put more emphasis on giving workers more individual autonomy (though this is far from universal pracice). I used to know a man who had been an efficiency expert. he said that he spent the first half of his career implementing 'time in motion' methods & the second half undoing them.

It sounds like Foxconn might be taking these methods to an extreme. This would certainly create conditions where some employees might feel depressed or trapped. You are also correct to point out that suicides can become a 'serial' event - with one triggering others among people already inclined to do so.

Scientific management - Wikipedia, the free encyclopedia

**highsea** · 07 Jun 10,, 02:05

Originally Posted by Bigfella

...I used to know a man who had been an efficiency expert. he said that he spent the first half of his career implementing 'time in motion' methods & the second half undoing them.

I had an employee who was drilling a hole in some stainless tubes. I set him up on the machine and left him alone. A little while later I noticed he kept walking back and forth to the area in the shop where he did the previous operation, which was a deburring operation on the same parts.

He would drill one part, then walk over to where the parts were, set the part on the cart and take another one, walk back to the bridgeport to drill another hole, and so on. Mind you, these parts were on a work cart with wheels.

I took my 100' yo-yo, collected him by the arm and walked over to the parts. I had him hold one end of the tape while I walked over to his machine. It was 80 feet. That's 160 feet round trip times 200 parts. A little over 6 miles of walking because he didn't have the sense to roll the parts over to his machine. Left alone, he would have spent 5 hours on an operation that had 2-1/2 hours allocated for it.

I count every tool change on my mills- that tool better be done when it goes back into the tool changer. I do a lot of multi-fixture setups, and one tool might be used in several different operations. I make sure it does them all before it gets put away.

15 seconds to change a tool might not seem like a long time, but over 5000 parts it's 20 hours of machine time. That tool change costs me money, I pay close attention to them. I won't tolerate a sloppy program that uses a cutter, puts it away, then pulls it back up later to make another cut somewhere else.

Time in motion is pretty damn important when you are manufacturing.