More Plant Disputes Arise at Apple Supplier Hon Hai


Updated October 7, 2012, 1:26 p.m. ET

By LORRAINE LUK

TAIPEI—Disputes last week among workers at a Chinese factory that makes Apple Inc.'s AAPL -2.13% iPhone put new scrutiny over the weekend on owner Hon Hai Precision Industry Co., 2317.TW -0.77% which has taken steps in recent months to address criticism of its labor practices.

The Taiwan company, which also uses the name Foxconn Technology Group, said Saturday that two disputes between employees occurred at its manufacturing plant in Zhengzhou in China's central Henan province, with neither incident leading to work stoppages. Hon Hai said it has addressed the disputes, which took place last Monday and Tuesday amid a weeklong holiday commemorating China's National Day. The company said the incidents involved a small group of production-line workers and quality-assurance personnel.

"There has been no workplace stoppage in that facility or any other Foxconn facility and production has continued on schedule," Hon Hai said. The company has 1.2 million employees in China.

Hon Hai said reports of an employee strike at the Zhengzhou plant are "inaccurate," and that all of its China employees who worked during the country's national holidays had done so voluntarily and have been paid in accordance with Chinese labor laws.

The company has provided additional employees for the production lines in question, among other steps, it said.

The statement came after a Chinese labor-rights organization said Friday that 3,000 to 4,000 workers, who were building Apple's iPhone 5, went on strike over increasing work hours and quality requirements. According to China Labor Watch, the strike participants came from a quality-control arm of Foxconn. It said Sunday that the workers had gone back to work the day before.

Apple didn't respond to requests for comment. Local police officials referred questions to Hon Hai.

Labor groups criticized Hon Hai employment practices after several workers at the company's massive manufacturing base in China jumped to their deaths in 2010. Hon Hai has since increased salaries and outfitted worker dormitories with safety nets in an effort to prevent such incidents.

Earlier this year Hon Hai and U.S.-based Apple agreed to reduce work hours and change other employment policies at Hon Hai's China factories after an audit by the Fair Labor Association, a Washington-based labor-rights group, found breaches of work, health and safety rules at some of the plants. Hon Hai has faced questions about labor issues as labor costs in China have been rising and many workers have sought better pay and improved opportunities. Last month, a fight at a northern China factory campus owned by Hon Hai escalated into a riot.

—Ian Sherr contributed to the article.
Write to Lorraine Luk at lorraine.luk@dowjones.com


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