Foxconn to pass on China wage rises to customers

Foxconn Technology Group says its customers — which include global technology giants Apple Inc. and Dell Inc. — will have to pay more after it increased wages in China by nearly two-thirds in the aftermath of a spate of worker suicides.

The comments from Taiwan-based Foxconn came at an annual general meeting Tuesday in Hong Kong, where protesters accused the company and Apple of poor corporate ethics. The 30 demonstrators held signs saying, “Workers are not machines. They have self-esteem,” outside a hotel function room where shareholders of the group’s Hong Kong-listed arm were meeting.

The company last week announced the second in a series of raises that would increase pay by up to 65 percent at its factories in the southern city of Shenzhen. The company employs 300,000 people there making iPhones and other goods for Apple, Sony Corp., Dell, Nokia Corp. and Hewlett-Packard Co.

Samuel Chin, chairman of the Hong Kong-listed Foxconn International Holdings Ltd., said the pay increases had been in the pipeline for months because of labor shortages in China.

“This matter has been discussed internally for several months already. We have experienced in the recent several months, difficulty of recruiting the necessary labor to support our operational needs,” he said.

“Many of our customers also have operations, fairly extensive operations in China, so they understand what’s going on. So we believe we will be able to have some success with the understanding to be able to offset some of the impact of the salary change.”

The protesters also targeted Apple Inc., waving a cardboard cutout of Chief Executive Steve Jobs with devil’s horns and another placard featuring the company logo and the words “Bloody Apple.”

Eleven workers have killed themselves and three attempted suicide at Foxconn’s operations in China this year, mainly by jumping from buildings.

Protesters laid white flowers at an Apple shop in a tribute to the dead workers. Organizer Debby Chan accused Foxconn of poor management, urging the Taiwanese manufacturer of iPhones and iPads to raise wages and let workers set up an independent union.

Chan said Apple should do a better job of monitoring labor and safety standards at their suppliers.

“They should strengthen their sense of corporate social responsibility,” Chan said in a phone interview.

Calls to Apple and Foxconn went unanswered, and there was no immediate response to e-mails seeking comment.

Labor activists accuse Foxconn of having a rigid management style, an excessively fast assembly line and forced overwork, but the company denies the allegations.

Associated Press