December 15, 2020 at 8:48 p.m.
- Apple’s partners currently manufacture devices and components in several foreign nations, including China, Taiwan, India, and Vietnam.
- This past Saturday, workers at the Narasapura Wistron iPhone plant in India rioted over wage discrepancies.
- The 2012 riots in Taiyuan, China Foxconn facilities resulted from unpaid overtime hours, sick pay denial, and an unyielding work pace.
- The Apple Supplier Code of Conduct stipulates that workers must be paid at least minimum wage with overtime compensation.
Indian Workers Riot at Narasapura iPhone Factory
As Apple grows, the company tries to diversify manufacturing. After all, production in only one nation is risky, especially when billions of dollars are at stake. China is less attractive, as US lawmakers’ trade negotiations may disrupt Apple’s supply chain. To this end, Apple expands its overseas manufacturing efforts to keep a steady supply of iPhones, iPads, and Apple Watches flowing to customers worldwide.
Wistron’s Naraspura manufacturing facility was Apple’s first foothold into India. Shortly after, Foxconn opened an iPhone 11 factory near Chennai. The Naraspura facility, tasked initially with iPhone 7 production, now manufactures the iPhone 11.
Workers at the Narasapura iPhone factory contend that they didn’t get promised compensation. Everyone from engineering graduates to low-skilled workers received less pay than agreed. On Saturday, December 13, 2020, tensions boiled over, erupting into violence. Over 2,000 workers rioted and damaged the factory. The rioters demolished executive offices, vehicles, and office equipment, causing an estimated $60 million worth of damage.
Wage Discrepancies Demonstrate a Lack of Oversight
Wages are the most basic arrangement between an employer and employee. The worker accomplishes tasks and expects appropriate payment. Wage disparities are the root cause of the Narasapura riot. Workers report gross under-compensation, with some paid as little as $7 per month.
In the case of the Narasapura riot, it’s clear that Wistron wasn’t paying workers their negotiated wages. Apple is currently investigating the issue, which it claims may be a violation of its guidelines. The company’s Supplier Code of Conduct stipulates that employers must pay a fair wage, among other conditions:
“Supplier shall pay at least the minimum wage and provide any benefits required by law and/or contract. Supplier shall compensate workers for overtime hours at the legal premium rate. Supplier shall communicate pay structure and pay periods to all workers. Supplier shall meet all legal requirements relating to wages and benefits, pay accurate wages in a timely manner, and wage deductions shall not be used as a disciplinary measure. All use of temporary and outsourced labor shall be within the limits of the local law.”
Although drafting a document outlining supplier responsibility, Apple’s oversight in distant manufacturing facilities is minimal. Apple expects manufacturers such as Foxconn and Wistron to abide by its conduct code, with little enforcement or monitoring.
2012 Taiyuan Riots Attributed to Harsh Labor Practices
Apple experienced a similar upheaval back in 2012, when 2000 disgruntled Foxconn workers rioted at the Taiyuan plant. Police eventually shut down the violence, with investigations concluding that working conditions were not the cause. Some reports claim the fight started when a security guard struck a worker. Authorities deployed 5000 law enforcement officers to quell the violence.
The book Dying for an iPhone depicts harsh conditions in Foxconn factories. The riots transpired when Foxconn pushed workers beyond their limits:
“In 2012 a riot took place at the Foxconn plant in Taiyuan. Workers were putting in 130 overtime hours a month, did not receive paid leave when sick, and were constantly pushed to work faster. Riot police were called, and several workers were detained and some beaten. In 2018, when contract workers at Foxconn Zhengzhou protested over unpaid bonuses, the government-controlled union failed to support them.”
After the 2012 incident, Apple contracted an auditor to oversee labor practices at the Taiyuan facility. It remains unclear whether the Cupertino company hires similar auditors for its other manufacturing concerns.
Will the Narasapura Riot Affect iPhone 11 Supply?
Wistron’s Narasapura manufacturing facility produces the iPhone 11, along with other factories in China and India. Multiple reports indicate that the $60 billion in damage occurred mostly to office equipment, buildings, and vehicles. It’s unclear whether the factory is operational; however, any downtime will likely disrupt iPhone 11 supply.
A lack of iPhone 11 units for sale might not be bad news for the Cupertino tech giant. Although multiple factories produce the iPhone 11, some consumers may choose to pay a little more for the iPhone 12, should their first choice remain unavailable.
Apple customers are often familiar with unavailability. Although shortages typically apply to hot, new Apple products, labor troubles can also affect supply. Last year’s iPhone may be challenging to find in the coming weeks. Wistron will ramp up production, but little kinks can noticeably affect supply.
Apple walks a fine line when it comes to labor. The company relies on cost-effective, skilled offshore workers to maximize profitability. It must also put on a magnanimous front, as most Apple customers dislike exploitative practices. The company will likely increase the auditing of its offshore manufacturing partners to save face and increase profits.