Wistron factory in Narsapura, about 60 km from Bangalore on December 13.
Photographer: Manjunath Kiran / AFP / Getty Images
Photographer: Manjunath Kiran / AFP / Getty Images
Wistron Corp., Apple Inc.’s main iPhone assembler. in India, it fell as much as 4% after the US technology giant put him on trial for lapsing working conditions that sparked a riot.
Apple said its preliminary investigation revealed that the Taiwanese supplier – the first to produce the US company’s gazebo device from India – failed to implement proper work-time management processes for a rapidly growing workforce. That delayed payment to some employees in October and November, and Apple said it is now withholding new customers until Wistron fixes the issues.
Hundreds of workers raged through Wistron’s factory in Narasapura near Bengaluru this month, damaging property and looting thousands of iPhones and laptops, local media reports. That highlighted the challenges Apple faces as it tries to diversify its massive manufacturing base for everything from iPhones to Macs away from China due to Trump-era trade and political sanctions. The fight also depresses Prime Minister Narendra Modi’s attempt to lure foreign investors into his flagship “Make in India” project, especially companies looking to leave the world’s second largest economy.
“Wistron has taken disciplinary action and is restructuring their recruitment and payroll teams in Narasapura,” Apple said in a statement over the weekend. “We have put Wistron on trial and they will not receive any new cases from Apple until they take corrective action. Apple employees and independent auditors will monitor their progress. “
Read more: Apple supplier with riot was hired more than he could handle in India
The Taiwanese company said it has removed the vice president, who oversaw operations in India, and has established a telephone hotline where employees can anonymously raise concerns.
Wistron had quadrupled the number of employees at that Indian factory in about eight months, ramping up production, just as the world’s most valuable company started direct online sales in the South Asian country. But the systems were not robust enough to handle the flood, say people familiar with the matter.
The incident could now affect its relationship with Apple, which has shown a greater willingness to address violations at its hundreds of suppliers. The American giant and its manufacturing partners have been criticized in the past for allowing poor working conditions in China. Last month, Apple suspended new business with Wistron’s bigger rival, Pegatron Corp., after discovering violations in a student worker program.
Wistron has estimated the damage at a whopping NT $ 200 million ($ 7.1 million) and said it is doing its best to resume operations at the plant. The Hsinchu-based company has also said the protesters are not its own workers, suggesting they may have been hired by employment agencies, although it is not clear who is responsible for paying them.
“This is a new facility and we recognize that we made mistakes during the expansion,” the Taiwanese company said in a statement on Saturday. “We are very committed to our company and our employees in India. We are working hard on corrective actions to make sure this doesn’t happen again. “
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