Behind the shiny screen

Are we consuming technology products without thinking about what happens to the people who manufacture them?

Behind the shiny screen

On 6 May 2010, Foxconn quality control worker Lu Xin jumped from the sixth floor of an apartment complex in the technology manufacturer's campus in Shenzhen, China.

Foxconn

Lu had moved to Shenzhen to work for Foxconn so he could support his family in rural China. He worked hard to send back thousands of yuan back home.

His job was to enforce quality standards of products on the assembly line, but within months he was struggling to cope with the intense demands of the job which kept him at work until 9pm on most days.

He blogged about his feelings in October 2009.

"I came to this company for money. [But then I realised], this is a waste of my life and my future. In the first step of my adult life, I took the wrong path. I'm lost," he wrote.

A rising tide?

Lu was the seventh of 17 Foxconn workers to commit suicide this year, and his experiences are detailed in the essay "Suicide as protest for the new generation of Chinese migrant workers: Foxconn, Global Capital, and the State" prepared by professor Ngai Pun and activist Jenny Chan from the Students and Scholars Against Corporate Misbehaviour group.

Just weeks after Lu's death, the suicides caught the attention of the global media, which raised questions about Foxconn's working conditions given the company's customers included Nokia, Apple and HP.

Foxconn

Ultimately, it raised questions about the price we pay for the technology we love and rely on, such as Apple's iPhone, Nokia handsets, the Sony PlayStation and HP computers.

In an interview with Bloomberg, Foxconn founder Terry Gou admitted he takes the suicides seriously and that he feels guilty, a significant departure from the initial response of the company and government officials, which had dismissed the deaths as accidents and unrelated coincidences.

Foxconn's response to the suicides has been to install anti-suicide netting around buildings to intercept potential jumpers, request employees sign an anti-suicide pact, and organise a rally with cheer girls wearing T-shirts printed with the logo "I [heart] Foxconn", according to media reports.

The response from technology vendors has been muted, with some saying they will review the relationship.

While there is no definite connection between the suicides and the working conditions, it has provided a platform for various groups to voice deeper concerns about wages, working hours and treatment of workers at factories across China.

Responsibility

This isn't the first time that the media has investigated Foxconn's production processes, labour conditions and its relationship with suppliers like Apple.

In 2006, British newspaper The Daily Mail published an article reporting on Foxconn's wages and working hours.

In response to the report, Apple audited Foxconn and found that the manufacturer largely complied with its corporate social responsibility (CSR) policies and supplier code of conduct. It did, however, uncover several violations, including workers being forced to work excessive hours of overtime.

Apple announced CSR initiatives to address the issues, which included joining the Electronics Industry Code of Conduct (EICC) industry group, set up to improve working and environmental conditions in global supply chains.

Apple and Foxconn did not respond to requests for comment for this article.

CSR is a multibillion-dollar, for-profit industry, which sets standards for companies' working and environmental conditions and audits companies on their compliance with their respective codes of conduct.

However, some aren't convinced the CSR industry has provided a benefit for workers, especially in China, or addressed the systemic issues that exist.

Ellen David Friedman has been a labour union organiser in the United States for the past three decades. In recent years, she has started to lend her expertise to some local trade union chapters and labour rights groups.

She has dubbed CSR a "cynical game" that has failed workers.

"Most scholars, independent scholars, would agree that corporate social responsibility has not in fact produced any tangible sustainable widespread or broad improvements for Chinese workers. There are many reasons for that, but that's the conclusion."

CSR is purely a public relations exercise and is "fatally flawed", according to Maquiladora Health & Safety Support Network (MHSSN) coordinator Garrett Brown, who has organised a number of projects investigating working conditions at factories in Mexico and across Asia.

He believes the transnational companies' overriding motivation is the pursuit of profits and the "iron triangle" of finding a supplier that can produce the highest quality product, for the lowest per unit cost and in the quickest time frame.

"So this is a very corrosive thing when you talk about CSR," Garrett says. "Because if your CSR code of conduct alleges that you're not going to work people endless hours of overtime, alleges you're not going to basically steal people's wages, alleges you're not going to cut on expenses required to meet environmental and occupational health requirements regulations, then your [return on investment] is going to be less than that of other competing companies on the stock market, no matter what country it is."

He says there are two major problems with the EICC and similar bodies: firstly, the inadequate wording of their code of conduct; and second, the poor manner in which the code is policed.

EICC spokesperson Wendy Dittmer did not respond to questions about the criticisms of the EICC and the CSR industry. However, she says the body has formed a taskforce to "look at the social, cultural and workplace issues that can impact employee health and welfare". She declined to comment further because the taskforce was under development.

A Chinese issue?

Commentators also say some blame should be pointed at the Chinese Government and the union, the All-China Federation of Trade Unions (ACFTU).

Friedman explained that after the socialist revolution in China, the ACFTU was established as a single organisation under the guidance of the communist party and the state, a structure common to most socialist countries.

The rationale is that because it is a socialist economy where there is no private ownership, there was no reason to have an antagonistic trade union, she says.

"Because the interests of the state which owns production are the same as the interests of the workers who work in production, so the trade union doesn't fight with the state on behalf of the workers."

The consequence of this is that union officials perceive their role as advocates for a good national legal framework of worker rights, as opposed to organising workers at the local and provincial level to represent and defend their rights, according to Friedman. Local governments, often competing among each other for foreign investments, had control of the union in their patch.

"With the introduction of private capital beginning the 1980s, the state opened up on the capital side to allow penetration of exploitative relationships of workers, but did not open up at all on civil society side to allow the trade union to actually defend and represent workers," she says.

"So the trade union is a very big and powerful organisation that has about 250 million members, and it is ... politically powerful and influential at the top, but completely invisible with no power at the bottom. That's a very common description in China."

Foxconn

Because of this, factory worker rights and issues are often not represented or addressed, according to University of Technology, Sydney professor Anita Chan, a core member of the university's Centre for Social & Cultural Change in China Investment.

"That means in Australia if you want to look at it this way, the ACTU does not have full control over what's happening in Melbourne, the Melbourne Government has control over the Melbourne trade unions council," Chan says.

Friedman says that in the past couple of years there have been some "impressive" laws passed which address issues of labour contracts, dispute resolution and arbitration, anti-discrimination, and regulations about the trade union organisation, but says that it is almost impossible to enforce these.

"Most western trade unionists, and I would include myself in this, would say the laws on the books have almost no relationship to the reality of workers' lives," she says.

Finding an answer

HP has taken a step to try and rectify matters, by taking part in a trial aimed to bring corporate social responsibility back into the workers' sphere, educating them about their rights and providing ways for them to resolve issues and create a better working environment.

The two-year pilot program took place in 2007 in Dongguan, southern China, and involved HP, its Chinese suppliers Delta Electronics and Chicony, as well as three non-governmental organisations, SACOM, Labor Education and Service Network (LESN) and the Chinese Working Women Network (CWWN).

SACOM facilitated and evaluated the training projects at two factories, which were organised by LESN and CWWN, SACOM's Chan says.

At Delta Electronics, LESN trained 1549 workers in basic labour rights — including providing every worker with a pocket-sized guide to the EICC and Chinese Labour laws in simplified Chinese — and also conducted several consultations for middle and lower management staff in corporate responsibility.

At the Chicony factory, CWWN trained one group of 2714 frontline machine operators and a second group of 30 worker committee members. It also established a hotline for workers to report problems confidentially, which helped to "manage grievances and to nurture a positive work culture".

The pilot was the first time that a vendor, suppliers and not-for-profit groups all worked together to implement a worker-based CSR model for worker rights, according to SACOM's Chan.

The project helped reduce the factory's staff turnover rates and resolve disputes in a quicker time frame, she says.

It also reduced HP's cost of supplier audit and improved its CSR compliance, because Delta and Chicony were admitted to the EICC after they completed the program.

Yet the project's biggest benefit was to empower workers with information about their rights, allowing them to better negotiate with their managers and supervisors, Chan says.

"In total at these two factories, over 4000 workers gained better knowledge about legal rights and how, using their corporate mechanism, they could influence some decisions concerned with wages and working hours.

"This gives workers confidence. How would they negotiate or bargain with the managers or the facilitation of communication is improved."

She says one key to the project's success was that it was run by independent groups, using independent sources of funding.

"We don't trust the suppliers themselves would be willing to devote lots of time and resources, or to raise awareness about worker rights, simply because the factories themselves have to keep just-in-time delivery and are much more concerned about production time and efficiency.

"So being a facilitator as well as an independent project evaluator, SACOM had a kind of autonomy or independence to make a judgement about how far this program has achieved, what are the limitations, what is the next step?"

While she criticises HP for its lack of follow-up on the pilot program, she says the vendor was more genuine than its competitors.

"When I compare it with others companies like Dell, Nokia, Apple and others, HP is already more progressive and open," she says. "They did finance the project and pressured the suppliers, when the Delta managers or Chicony managers didn't co-operate enough.

"I do believe that our promise of not campaigning against the two factories in those two years, it gave them time to reflect on some issues that were highlighted and they were more willing to listen to us in the middle and final stages of the project."

HP did not provide a spokesperson for comment for this story and referred to the CSR measures outlined on its website.

A more recent incident did, however, cast doubt on exactly how much HP is doing. Workers at a factory in Australia owned by HP-supplier Foxteq says they were being treated like robots. HP says it is investigating the matter.

Storm in a Teacup?

Local technology manufacturer and retailer Kogan uses Chinese suppliers to produce its products, and performed a routine tour of the factories last week.

Founder and CEO of Kogan, Ruslan Kogan, says workers have similar working hours to Australia, 8am to 5pm, five days a week, with two-and-a-half-hour breaks and staff are given the option to work overtime. There is less than 10 per cent staff churn at the factories that manufacture Kogan products, he says.

He says the technology companies provide an opportunity that wasn't previously available.

"These companies setting up there brings a lot of prosperity to the area, and every single worker we speak to at these factories, when we walk through the production line floor, are interested in the products and they love their job," he says. "Because the alternative is very ugly."

"The basic truth it comes down to, is force is not used against anyone in the manufacturing of these products, there is zero force used, no one is holding a gun to the head of these people, the reason they're working in these factories is because that is the best alternative they have."

Foxconn

It comes down to a matter of personal choice for the worker, he says.

"No one will ever make a personal choice for something that is worse for them, so these people are coming to work at these factories because that's the best possible option they have for their quality of life."

Chan says she just wants workers to feel confident in the workplace.

"At the end what I really care about is how much workers are feeling confident or capable of making changes. To contribute to a better workplace environment, a more humane and respectful workplace [where] workers are free from harassment or unfair treatment."

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