Foxconn worker dies of exhaustion – focus on working hours

On 27 May 2010, a worker at the Foxconn factory in died from overwork, according to a statement released on 4 June 2010 by SACOM.  This coincides with a statement by Hon Hai Precision Industry on 6 June 2002, Hon Hai owns the Foxconn facility in Shenzhen.

The SACOM statement reports:

“Yan Li, 27, is the latest victim of Foxconn, the manufacturer of iPads and other high-tech items that has experienced a recent rash of worker suicides.  He collapsed and died from exhaustion on 27 May after having worked continuously for 34 hours.  His wife said Yan had been on the night shift for a month and in that time had worked overtime every night…”

There is clearly something structurally wrong with the working hours basis of the Foxconn factory.  Foxconn is a contractor or supplier of high-tech devices to major Western corporations who claim to have stringent oversight regimes.

The Wall Street Journal (WSJ) (not available online except for iPad users)  reports the 4 June Hon Hai statement in which wage increases are announced with the intention of improving worker health or, in Western terms, work-life balance.  The WSJ article states:

“This wage increase has been instituted to safeguard the dignity of workers, accelerate economic transformation, support Foxconn’s long-term objective of continued evolution from a manufacturing leader to a technology leader, and to rally and sustain the best of our workforce.”

Elsewhere in the WSJ article (also reproduced in hard copy in The Australian, page 22) the company says it is working to make it “workplace standards and remuneration….best-in-class”.  What Foxconn considers “best-in-class” is unclear  but one should not equate it to “world’s best practice”.

The issues of remuneration and overtime link the themes of the Hon Hai statement and Yan Li’s death.  This link does not only illustrate just a Chinese phenomenon as it is is common for workers to undertake overtime in order to substantially boost one’s salary.  The risk comes from the gradual institutionalisation of the overtime and from the worker’s economic choice to, sometimes, sacrifice personal health or leisure for more pay.

The pay increases are keeping the Foxconn labour issues in the media with a New York Times article on 6 June 2010 flagging that the issue of salaries will become an important economic problem.  It quotes Hon Hai Precisoion Industry claiming that salaries have almost doubled within a matter of weeks.  The article goes on to state that global users of Foxconn-manufactured products may “eventually be forced to pay more for a wide range of goods”.  Shock! Horror!  The corporate social responsibility push over the last twenty years was supposed to erase such global inequities and the backlash against the CSR movement will gain considerable momentum from the attention gained by Foxconn and the worker suicides and deaths.

An additional possible motivation for Hon Hai/Foxconn’s actions could be that the company’s share price has fallen on the Taiwan exchange from a notable high of 153 on 28 April 2010 when the suicide media attention gained momentum to 117.5 on 8 June, at the time of writing.

Interestingly, the Australian Financial Review ran the NYT article by David Barboza but edited it slightly.  Below is the section cut from the reprint and, curiously, it concerns worker health and safety and corporate responsibilities:

“Police in Shenzhen say 10 Foxconn workers have committed suicide this year.

Foxconn executives have blamed social ills and say the suicides are not work related. But company executives say they are all they can to stop workers from attempting suicide and to improve working conditions at its huge plants in Shenzhen.

Concerned about the suicides, Apple, Dell and other global companies say they are looking into conditions at Foxconn, which is China’s biggest exporter.

In a statement on Sunday, Foxconn said the “wage increase has been instituted to safeguard the dignity of workers” and help advance the company’s growth initiatives.”

The remaining AFR article skews Barboza’s original article by diluting the safety issues and leaves the suicides to be minimally described as “bizarre”.  What does this indicate about the priorities of the AFR editors and how does this reflect on the readers of the Australian Financial Review?

Kevin Jones

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