Foxconn workers wait for a ray of hope in new year

As the company suspends operations in the wake of the Nokia shutdown, about 1,700 workers are staring at a bleak future, pinning their hopes on the next round of talks with the management

The closure of Nokia's plant in Chennai is having a ripple effect on workers across the state. The latest to be hit are the employees of Foxconn, a Taiwan-based company, which has suspended production following steep fall in orders in the wake of Nokia shutting down its facility there.

FIH India, formerly known as Foxconn India, in fact stopped operations at its factory at the Nokia Sriperumbudur SEZ near Chennai two days before the announced date of December 24, triggering fears of massive lay-offs among workers.

In a statement earlier the company said the decision to close the factory is part of an undergoing restructuring exercise in India. It added that "due to drop in business and drop in orders from the customers we are unable to give regular work to the employees."

One of Foxconn's key customers was Nokia, which suspended operations from November. Nokia's unit, which employed around 8,000 workers directly and another 21,000 indirectly, had to shut its plant following a tax dispute that prevented its transfer to Microsoft which had bought the Finnish company's handset business early this year.

With massive job losses, first at Nokia and now at Foxconn, the workers say they face a bleak future as new opportunities are hard to come by. Though the company has said it will offer a severance package to workers, the employees are not happy as they want to retain their jobs.

"The workers, whose average age is around 25, had made plans based on the calculation that they would get a certain amount as salary every month. Now they are not sure whether they will even have their job or not. Everyone is confused now," says E Muthukumar, president of Foxconn India Workers' Union. He says workers want jobs and not a voluntary retirement scheme, or VRS. With seven to nine years of experience, workers were getting a salary of Rs 15,000 to Rs 17,000 a month, and there are around 1,700 workers who have not opted for VRS and are still dependent on the plant for their livelihood.

While work at the factory has been suspended, the standoff between the management and workers continues. The workers' union is pressing the management to look at manufacturing new products, such as parts for smartphones, instead of just focusing on feature phones that it does now. The workers says with fresh investment and training, the factory can be readied to cater to the smartphone market which is going to be the way of the future.

"They can upgrade the machine, and keep the workers employed. Considering the workforce is down to a fraction, the management will not have major costs to bear," says a worker. The management, however, has said no such plan to upgrade the machinery is underway.

The workers have also approached the government through a sitting MLA, says A Soundararajan, honorary president of Foxconn India Workers' Union, a body recognised by the company. However, no word of reassurance has come from the government so far.

Disappearing jobs
With little help forthcoming, Soundararajan fears Foxconn too will go down the Nokia way where the state government instead of simplifying matters slapped a tax notice of Rs 2,400 crore on the plant, complicating the issue further.

Unemployment has been piling up in Tamil Nadu's Sriperumbudur-Bengaluru industrial corridor, as the year has seen several factories, including Nokia, Jabil, BYD, Motorola and now Foxconn pulling out of the area. For Foxconn workers, finding a job is even more difficult as they are seen as troublemakers for having worked with a company that has a recognised worker's union, say union members. Nokia workers who had opted for VRS also had to face similar rejection from potential employers.

Around 35,000 workers have lost their jobs in recent months, including a large number of women. The shutting of factories has also affected others such as canteen boys, bus cleaners and mechanics who were dependent on the large in-flow of migrant workers to the region for jobs, say sources.

Soundararajan says the union has no option but to step up the protest. He will be meeting the leaders of other unions to discuss the future course of action. Meanwhile, he says unions at other factories in a show of solidarity with the protesting workers at Foxconn will start boycotting lunch and other facilities offered by the management till the issue is resolved.

The union is pinning its hopes on the tripartite meeting with the labour commissioner scheduled for December 26. In case, the talks fail, workers will take to protesting in front of Foxconn gate every Monday, says Soundararajan.

He also claims the management is in violation of labour laws for denying work to those who have refused to accept VRS. The union has filed a complaint against the alleged violations with the labour commissioner. Since March, the company has not been able to provide regular work to around 100 workers. This number has since increased to 850. However, the company says salaries were being paid to all workers in time.

Can Taiwan come to the rescue?
Taiwan-based Foxconn is the world's largest contract manufacturer of electronic goods. Its mobile arm, FIH Mobile, assembles products for clients like Apple at factories predominantly in China. Before it started supplying parts to Nokia, Foxconn's Sriperumbudur plant was producing electronic equipment for Sony and Motorola.

"We will not allow the plant to close. Nokia's issue was different. Foxconn gets orders from across the globe. The management can't give an excuse that it is suspending operations because Nokia has left. It can still run the plant and supply to other handset makers," says Muthukumar. He adds that workers will not find new jobs because of their salary which is considerably high for the region and more than what other factories in the area pay. Many of his friends at Nokia, he says, are still unemployed.

The union is determined to keep the fight on. A worker, on condition of anonymity, says that the protest at Nokia India came to a swift conclusion because a large number of workers agreed to leave the organisation after accepting the Voluntary Retirement Package and Severance package. "The situation might be different at Foxconn, since we are not going to settle for VRS," he says.

The impasse is unlikely to end anytime soon. After the December 26 meeting with the assistant commissioner of labour, the next meeting is scheduled for December 29.