Hon Hai Precision Industry's Chinese Foxconn unit has been having
at its Shenzhen plant lately. A string of suicides has
compelled Apple, Dell, and HP to launch a string into the supplier.
Foxconn previously responded by playing Buddhist
music, offering employee counseling, and most requiring
a letter promising not to kill themselves.Apparently
that's not working out so well. On late Thursday, an employee
slit his wrists, and according to the AFP has
since become the eleventh to die this year.After receiving
news of the latest attempt Sony, Nintendo,
and Nokia joined a pending probe into the company's business that
currently included Apple, HP, and Dell. In response to
criticism about the letter, Foxconn CEO Terry Gou retracted it,
saying it was inappropriate.Guo is also trying yet another
tactic in hopes of convincing its employees not to jump off high
buildings -- giving
them a pay raise. Foxconn does give occasional raises, and
claims that it has been planning to do so for some time, but never
got around to it. Currently entry level workers are paid 900
yuan (about $131.80) per month and also have the chance to earn
overtime or bonuses.According to Vincent Chen, an analyst at
Yuanta Securities in Taipei, says that Foxconn typically bumps wages
by 20 percent to meet holiday demand for consumer electronics.
However, he says that a pay raise of 50 percent is not outside the
realm of possibility.The pay raises will reportedly raise Hon
Hai's operating costs by T$2.7B ($84M USD) and cut the company's
profits by 10 to 12 percent, according to analysts at Citi.
Other analysts disagreed, though. Chen comments, "I don't
think this will impact Hon Hai's profitability...Hon Hai has raised
salaries by up to 50 percent in the past, and it's still doing
well."It is believed that at least some of the suicides
were financially motivated. According to various employee
accounts families of suicide victims with the company are typically
paid between 8.5 and 10 years of pay. Faced with scant
salaries, some depressed employees reportedly think they are doing
their families a
favor by killing themselves.Foxconn is also planning
relocation of about one fifth of its 400,000 employee
Shenzhen workforce in Southern China to a plant in Western China.
Workers often migrate to get jobs at Foxconn's plants. By
moving the workers closer to home, Foxconn believes it can decrease
quote: $132 a month sounds low, but remember that the cost of living in China is much much lower than here. The average restaurant charges $1 per person for a full meal.
quote: Don't try to rationalize low wages with cost-of-living nonsense. These workers live lives of unimaginable poverty. I would literally rather be homeless in any American city than work for Foxconn in China.