Taiwan's Hon Hai Precision Industry plans to raise workers' salaries by about 20 percent at its Foxconn unit in China, as it struggles to stop a spate of worker suicides and quell rising public anger.
An employee of Foxconn, maker of Apple Inc's iPhone, jumped to his death late on Wednesday, bringing the total of such apparent suicides to 10 this year. Another employee attempted to slit his wrists, but survived with medical attention, Xinhua news agency said late on Thursday. A small worker protest formed in front of Hon Hai's head office in Taipei on Friday morning, with protesters setting out candles and white flowers as security guards watched.
Hon Hai spokesman Edmund Ding said the increase in the cash portion of pay packages for all its workers in China had been planned for some time. He did not say when the raises would be implemented.
...
The spate of deaths has thrown a spotlight on the labor practices of Foxconn, whose clients include Dell Inc, Hewlett Packard Co and Sony Ericsson. Apple and other clients have said they are investigating working conditions at Foxconn, which has about 420,000 employees at its base in Shenzhen and has come under fire for its secretive corporate culture.
FINANCIAL IMPACT
The planned pay rise could raise Hon Hai's quarterly labor costs by about T$2.7 billion ($84 million), which would erode its operating profit by around 10-12 percent, Citi said in a report.
...
Chen added that labor costs accounted for only around 2 percent of Hon Hai's operating costs and a salary increase of about 20 percent was not unusual.
http://www.reuters.com/article/idUSTRE64R0U920100528