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Amazon and Foxconn reportedly strip workers of benefits and pay low wages in Chinese factory

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In violation of Chinese law

Image: Reuters

Foxconn said yesterday that it’s investigating its factory in southern China that makes Amazon Echo Dot and Kindle devices after a US labor watchdog reported finding poor working conditions on site that violate Chinese law, as spotted by Reuters.

A report from the New York-based China Labor Watch found that the Hengyang Foxconn plant in Hunan province, which primarily makes devices for Amazon, relies on temporary workers with a high turnover rate, pays them far less than the local average, and puts them on long, unpaid vacations, which forces many of them to resign to find paying work.

A China Labor Watch investigator went undercover as a worker to interview 20 other workers at this factory and to observe conditions. He obtained a position in the factory to clean Echo Dot speakers using a toothbrush dipped in rubbing alcohol to remove dust.

He found that workers are supposed to earn an hourly wage of 14.5 RMB ($2.26), but that’s actually a base wage of 13.5 RMB ($2.11) with a 1 RMB hourly attendance bonus that’s hard to earn. If a worker takes more than two days off from work in a month or if they’re late a few times, they lose the bonus. A worker starting at the factory in the middle of the month is similarly out of luck, and if the boss makes a worker take mandatory leave, that will also count against the attendance bonus.

The average monthly wage in Hengyang, Hunan, last year was 4,647 RMB ($725.22), but Foxconn workers earn an average of $390.16 a month. Workers reported having an unexcused absence would cost them three days of wages. Workers also count on overtime to boost their wages, but supervisors take away overtime as a punishment for dropping or damaging speakers or other behavior. Since overtime is the main source of supplemental income, it can also be damaging to workers as they put in excessive hours. Even though Chinese law says that monthly overtime shouldn’t exceed 36 hours, Foxconn workers at this factory were found to put in over 100 hours of overtime each month during peak production season. The report finds that some workers worked 14 days in a row with no days off.

Even time off isn’t really a benefit. During the Labor Watch’s nearly year-long investigation, the factory allowed regular and temporary workers to take vacations for over a month from January to February and for over a week at the end of May. Since temporary workers have unpaid vacations, many of them chose to resign during these periods.

The factory has no medical facilities or hospital on site, so any injured workers have to be transported to a hospital that’s farther away. Another work hazard is the lack of fire safety: there are no exits or labeled escape routes and no fire safety drills. Similar to other factories that China Labor Watch has reported on, there’s no labor union for the Hengyang workers. There’s a process for filing complaints, but the workers don’t believe it does any good.

This isn’t the first time that Foxconn has been found to have terrible working conditions. In 2010, Foxconn factories in China saw a rise in worker suicides, which were meant to bring awareness to the labor conditions. Although Foxconn said it would improve conditions, later in 2012, about 150 workers threatened suicide reportedly over a promised raise that was never delivered.

It’s also not the first time Amazon has come under fire for its poor labor practices. In April, an anonymous survey confirmed the findings of British investigative reporter James Bloodworth, who wrote that workers were skipping bathroom breaks and peeing in bottles to keep up production levels. At this Foxconn factory, workers similarly face barriers to go to the bathroom during work hours. They have to report a bathroom break to the line technicians and also watch out for working too slowly.

We’ve reached out to Amazon for comment. Amazon responded to the report in a letter to China Labor Watch, stating, “Amazon takes reported violations of our Supplier Code of Conduct extremely seriously...which states suppliers must provide workers a safe and healthy work environment, working hours must not exceed the maximum amount permitted by law, and suppliers must pay their workers in a timely manner and provide compensation (including overtime pay and benefits) that, at a minimum, comply with applicable laws.”