Apple puts Foxconn factory on probation after food-poisoning incident

Almost two weeks after a food-poisoning incident at Foxconn’s hostel in Sriperumbudur which led to hospitalisations, protests, and arrests, the company and its local officials were in the line of fire on Wednesday. While Apple said that it has put the Tamil Nadu unit, which manufactures iPhones, on “probation” because its hostels did not meet the American tech giant’s compliance norms, the Taiwanese multinational announced restructuring of the local management team.

Foxconn also accepted that its dormitory facilities did not meet the required standards. The food poisoning incident early this month had affected around 260 people and 159 were hospitalised. Following this, Apple had appointed an independent auditor to undertake additional detailed assessments.

“Foxconn’s Sriperu­mbudur facility has been placed on probation and we will ensure our strict standards are met before the facility reopens. We will continue to monitor conditions closely,” said an Apple spokesperson. Apple said it found the accommodation and dining facilities at the unit did not meet the compliance requirements.    

“We hold our suppliers accountable to the highest standards in the industry and regularly conduct assessments to ensure compliance. We found that some of the remote dormitory accommodations and dining rooms being used for employees do not meet our requirements and we are working with the supplier to ensure a comprehensive set of corrective actions are rapidly implemented,” he added.

After Apple’s statement, Foxconn acted quickly. It first apologised to its employees and then announced to restructure its local management. The details of this top-level rejig were not revealed. “We are very sorry for the issue our employees experienced and are taking immediate steps to enhance the facilities and services we provide at the remote dormitory accommodations,” said a statement by Foxconn Technology Group. “We are also restructuring our local management team and our management systems to ensure we can achieve and maintain the high standards that are needed.”

Foxconn further said the safety and wellbeing of employees is its priority.

“We have been investigating recent issues at our Sriperumbudur facility in Tamil Nadu and have found that some offsite dormitory facilities do not meet the required standards,” it said.

Giving a thrust to the Make in India initiative, Apple was reportedly manufacturing around 70 per cent of its mobile phones, in value terms, that it sells in the Indian market through its two Taiwanese contract-manufacturing partners Foxconn and Wistron. Early this year, Wistron’s facility at Narasapura in Karnataka was also kept on probation, following a rampage by workers alleging non-payment of salaries and overtime wages. The incident reportedly led to a loss of over Rs 400 crore.

Soon after the food poisoning incident, the Sriperumbudur unit was also raided by the tax authorities as part of a nationwide raid on mobile manufacturers and distributors.

“All employees will continue to be paid while we make the necessary improvements before restarting our operations and we will continue to provide support for our employees as they return to work,” it added.