iPhone maker Wistron cries conspiracy, may roll back India expansion plans

Plans to hire up to 25,000 employees by the end of 2021 look doubtful now for the Taiwanese company, say sources

Taiwan-based iPhone maker Wistron is deliberating whether it should continue with its expansion plans in India, sources said, after some workers ransacked its Karnataka facility, which company insiders have called a planned conspiracy to rob the plant. The firm, which manufactures iPhones and other IoT products at the facility located in the Kolar district, had plans to hire up to 25,000 employees by the end of next year. This looks doubtful now, the sources said.

The firm employs around 12,000 people at the plant of which only around 1,200 are permanent while others were hired on a contractual basis. The third-party iPhone manufacturer had recently announced an investment of over Rs 1,200 crore in Karnataka to increase manufacturing capacity.

“We are deeply shocked by the events at our Narasapura facility. We follow the law and are supporting the authorities with their investigation. The safety and wellbeing of our team members is always our top priority,” said the firm. Apple said it has begun a probe and has dispatched team members and auditors to the facility for the same. “We have teams on the ground and immediately launched an investigation at Wistron’s Narasapura facility in India. Our teams are in touch with local authorities and we’re offering our full support to their probe,” said Apple.

On Saturday morning, thousands of pople went on a rampage, breaking window-panes, ATMs, CCTV cameras, vehicles and other equipment at the campus, alleging salary deductions and untimely payments of wages. While property worth Rs 10 crore was damaged, it has been alleged by the company in the FIR that iPhones and laptops worth crores were stolen during the incident. Total loss has been estimated at Rs 437 crore. About 160 people have been arrested in the matter so far. 

Sources in the company agreed that while there could have been some lapses in payments of dues, they alleged several employees who did not work for several days demanded full salaries and overtime dues in advance.

“Before the incident we heard weird allegations such as the rasam was too spicy and that the air-conditioning was too cold,” said a person familiar with the matter. While employees say they were made to work 12 hours a day, with eight hours of regular and 4 hours of overtime work, sources clarified they were made to work only four days a week. The company had ramped up hiring since June and increased the employee base from 2,000 in June to 12,000 in October.

The arrangement was workers would be given permanent jobs after two years of service, said a source. 

On Friday night, a group of employees got into an argument with the human resources team regarding the wages. The company promised to clear the bills by Monday morning after which the night shift employees left the campus. But within a few hours, a group of unidentified people came in with rods and sticks and started damaging the property, said sources who witnessed the incident. “They specifically attacked the places where laptops and phones were kept,” alleged a source.

It was also alleged that the district administration reacted slowly and that the police reached two hours after the rampage began even though the company had intimated the officials in advance as it had sensed trouble.

The state government said an incident like this puts the state in bad light. 

“While the workers were promised monthly wages of Rs 22,000, they have received substantially lower amounts despite having worked overtime on all days without any leave. Wages for November are yet to be paid,” according to a report submitted to the state by the All India Central Council of Trade Unions.