Rights group hits Amazon, Foxconn over poor China labor conditions

China Labor Watch cited excessive hours and low wage at Foxconn’s Hengyang Foxconn plant in Hunan province, which makes Amazon’s Echo Dot smart speaker and Kindle e-reader. (AFP)
Updated 14 June 2018
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Rights group hits Amazon, Foxconn over poor China labor conditions

NEW YORK: A US watchdog group criticized Amazon.com and contract manufacturer Foxconn over what it described as harsh working conditions at a plant in China that makes the retail giant’s Echo Dot smart speaker and Kindle e-reader.
The 94-page report by New York-based China Labor Watch cited excessive hours, low wages, inadequate training and an overreliance on “dispatch” or temporary workers in violation of Chinese law at the Hengyang Foxconn plant in Hunan province.
Taiwan-based Foxconn, known formally as Hon Hai Precision Industry Co., is the world’s largest contract electronics manufacturer and employs more than a million people.
Foxconn, which also makes Apple Inc. iPhones, came under fire in 2010 for a spate of suicides at plants in China. Foxconn pledged to improve working conditions.
China Labor Watch said its nine-month investigation found that about 40 percent of workers at the plant were dispatch workers, far exceeding the 10 percent limit under Chinese law. Dispatch workers were paid at the same rate for regular and overtime hours, rather than time and a half as required, said China Labor Watch Program Officer Elaine Lu.
“They were underpaid,” Lu said. “That’s illegal.”
Dispatch workers earned 14.5 yuan ($2.26) per hour, the report said. Workers also put in more than 100 overtime hours per month during peak season, far more than the 36 hours allowed by law, and some worked for 14 consecutive days.
Amazon said in a statement it audited the factory in March and found “two issues of concern.”
“We immediately requested a corrective action plan from Foxconn,” Amazon said, adding it is monitoring Foxconn’s response and “compliance with our Supplier Code of Conduct. We are committed to ensuring that these issues are resolved.”
Amazon did not say what the issues were or whether they had been addressed.
Foxconn said in an emailed statement that it “works hard to comply with all relevant laws and regulations” where it operates and conducts regular audits. “If infractions are identified, we work to immediately rectify them,” it said.


Tesla plans 7% staff cut as CEO Elon Musk says company must ‘work harder’

Updated 22 min 16 sec ago
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Tesla plans 7% staff cut as CEO Elon Musk says company must ‘work harder’

  • Tesla delivered over 245,000 electric cars and SUVs last year, nearly as many as all previous years combined
  • But its 2018 production fell far short of a goal set nearly three years ago of manufacturing 500,000 vehicles for the year

Saying the road ahead was “very difficult,” Tesla’s CEO Elon Musk said Friday that the company would be cutting its staff by about 7 percent.
The electric car and solar panel maker notified its employees about the staff cuts and other plans in an email posted on Tesla Inc.’s website.
Musk said Tesla hopes to post a “tiny profit” in the current quarter but a 30 percent expansion in its workforce last year was more than it can support.
Tesla’s shares tumbled earlier this month after it cut vehicle prices by $2,000 and announced fourth-quarter sales figures that fell short of Wall Street estimates.
“Our products are too expensive for most people,” Musk said in the memo to Tesla staff, saying the company has to “work harder.”
“Tesla has only been producing cars for about a decade and we’re up against massive, entrenched competitors,” he said.
Musk said in a tweet in October that Tesla, based on Palo Alto, California, had 45,000 employees. A 7 percent cut would involve laying off about 3,150 people.
“We unfortunately have no choice but to reduce full-time employee headcount by approximately 7 percent ... and retain only the most critical temps and contractors,” he said.
The company says it delivered over 245,000 electric cars and SUVs last year, nearly as many as all previous years combined. But its 2018 production fell far short of a goal set nearly three years ago of manufacturing 500,000 vehicles for the year. That goal was announced in May of 2016 based on advance orders for its mid-range Model 3, which Musk said sells for $44,000.
Musk said Tesla plans to ramp up production of the Model 3, “as we need to reach more customers who can afford our vehicles.”
“Attempting to build affordable clean energy products at scale necessarily requires extreme effort and relentless creativity,” he said in the memo, “but succeeding in our mission is essential to ensure that the future is good, so we must do everything we can to advance the cause.”
Tesla broke ground earlier this month for a factory in Shanghai, its first outside the US. Musk said it plans to begin production there of the Model 3 and a planned crossover by the year’s end.
Tesla and other global automakers including General Motors Co., Volkswagen and Nissan Motor Corp. are pouring billions of dollars into manufacturing electric vehicles in China.