China's Foxconn Worker's Still Aren't Earning Enough Money

 @mflorcruzm.florcruz@ibtimes.com
on December 20 2012 10:46 AM

Foxconn, one of China's biggest electronics manufacturers and the maker of most Apple products, has been at the center of a number of labor scandals in recent years. However, employees at factories are hoping to work even more hours than they already do as they seek to make a decent wage.

According to the Wall Street Journal, last year the Fair Labor Association went to Foxconn factories to take an audit of the manufacturing giant's work shifts and found that employees there were working 12-hour shifts, and sometimes even longer. According to the Atlantic, the regular work days of employees exceeded the legal limit in China of 40 hours per week and a maximum of 36 hours of overtime per month. As a result, Foxconn pledged to reduce available hours for workers  to a maximum of 49 hours per week, including overtime. 

Now, Foxconn employees are asking to be allowed to work more overtime hours because they claim they are not making enough money, even when working the new maximum number of hours. More than 15 Foxconn workers were interviewed, and they all claimed they already work between 10 and 15 overtime hours a week, exceeding the legal limit, and would work even more if given the opportunity. 

Many of the employees at Foxconn are originally from rural areas and have come to the factory located in southern China, near Hong Kong, to earn and save money quickly to send back home. However, limiting the amount of hours they can work also limits the amount of money they can bring home. 

The best solution to prevent overworking employees, and thus hopefully avoid another spate of employee suicides, would to be raise hourly wages. Foxconn has reportedly increased hourly pay three times this year. Now, the base pay of an employee is around 2,200-2,500 yuan a month ($350-$400), up from the previous 2,000 yuan ($321). At that rate, working regular hours does not satisfy employees who end up still working brutal 15-hour shifts. The pay increases do not equal the potential earnings that employees used to have.

One worker identified only as Ma was quoted  by the Wall Street Journal as saying that by working overtime, he was able to double his monthly wage to about 5,000 yuan ($800), exceeding the legally prescribed limit. 

Now, the problem may become Foxconn's. The electronics manufacturing company may have a tough time retaining its 1.5 million employees once the new hour restrictions are rolled out next year. 

Ma is one of those people who does not think his increased regular pay will make up for the cut hours.

"We don't know how much our salary will go up. But after being here three years, I don't have much incentive to stay, since my wage probably won't rise much," Ma said in the report. 

And Ma is not the only one who may leave. After all, the goal for many is to make as much money in a day they physically can, not necessarily having job security. Foxconn did not comment on what it planned to do to retain its employees, but Bernstein Research estimated that the base salary of employees would have to be increased by 50 percent to compensate for cut overtime hours. 

For now, Foxconn has improved the facilities' working and living conditions. With dormitories that room friends together, recreational facilities and mental-health professionals on-site to counsel employees, and even high school and college education courses on-site as well, the company hopes that these other benefits will be appealing enough to retain employees.

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