updated 11:40 am EDT, Wed October 13, 2010
Foxconn again said raising prices to match pay
Citibank analyst Chang Kaiwei claimed to investors today that Foxconn would be raising the prices it charges companies like Apple, Microsoft and Nokia to compensate for the second pay raise for its workers. The unspecified charges, which would take effect this month, would keep Foxconn's profits up while hopefully improving the welfare of employees. Foxconn and its parent company Hon Hai didn't confirm the plans.
Apple and other involved companies also haven't responded.
The company has tried to maintain that it offers good working conditions but had this view undermined after a series of suicides drew attention to conditions at its factories, especially in the Shenzhen area of southern China. Employees regularly work overtime and have complained of little tolerance for breaks or injuries, as well as widespread abuse. Doubts have surfaced as to the effectiveness of wage hikes, as some have reported getting just a third or less of the extra pay.
For its part, Foxconn has denied recent allegations but has simultaneously tried to head off their root causes, up to and including a warning that it wouldn't pay families benefits for employees that commit suicide. The spate of deaths earlier in the year may have been triggered partly by workers whose salaries were low enough that their deaths could provide their families with the equivalent of 10 years of work.