Ground Zero | iPhone plant violence — The making of a tinderbox


Long shifts and failure to resolve payment and overtime issues allegedly led to the violence by the workers in an iPhone factory in Narasapura earlier this month. Sharath S. Srivatsa reports on the night of the unrest and the many violations of labour rules by Wistron

Anxiety writ large on their faces, Abhishek and Sunil walk into a small playground littered with garbage. Their attentive eyes scan the area to see if anyone other than The Hindu team is in the vicinity. It takes a lot of convincing for the duo, engineering graduates in their early 20s, to open up.

Abhishek and Sunil, who are from Kolar city in Karnataka, went to work until recently. Now they not only worry about whether they still have their jobs, but are also scarred by the violence that broke out on December 12 at their workplace, the Wistron Infocomm facility at Narasapura, about 20 km from Kolar, where workers assemble Apple’s SE2 iPhones.

Also read | There is no one to hear our woes, say Wistron workers

The trigger

“We did not expect violence though tensions had been simmering among the employees over lack of payment for overtime and problems with the punching machine that resulted in loss of pay,” says Abhishek. The sudden increase in work hours was taking a toll on their health, he says. The anger reached a peak on December 12.

At around 5.45 a.m. on that day, when the night shift employees were getting ready to leave and the day shift employees had just walked in, an argument broke out between the contract employees and the executives of a staffing company that had hired them, recalls Sunil, who is employed in the Final Assembly Test and Pack (FATP) department. The night shift employees claimed that they had not received any information about their salaries being credited to their accounts (they had deposited their phones in lockers before getting into the assembly line). Those in the day shift had noted that discrepancies in overtime wages between what they were entitled to and what they had received for the months of October and November had continued into December as well.

On the night of December 11-12 (Friday-Saturday), the atmosphere was tense, Sunil recalls. Employees stopped production in the assembly line a few times in protest and gathered in small groups to discuss these issues. They approached the manager in one of the lines, who promised to sort out the matter by Monday. However, as the shift ended and workers came down to the locker room adjacent to the exit area, where punching machines are installed, miscommunication between the executive of a staffing company and those employed by the company sparked off violence, says Sunil. There were about 200 angry employees at the spot, clearly outnumbering the 30 odd security staff present at the time. In all, about 5,000 employees were present at the 43-acre facility when the violence broke out.

Then pandemonium broke out as enraged workers broke the window panes, set the aprons they wear in the assembly line on fire, and broke CCTV cameras, laptops and other electronic gadgets. Several employees allegedly took with them laptops, modems and any other gadget that they could lay their hands on. A tea stall owner just outside the facility says some laptops had been recovered from the fields too.

 

Wistron, the Taiwan-headquartered company, which claimed the losses to be worth ₹437 crore, in the First Information Report filed with the Narasapura police, drastically scaled down the extent of losses later to ₹40 crore. As many as 167 workers have been arrested following the violence, and an FIR mentions 7,000 workers. “Investigation is on and we have recovered some of the stolen laptops. Two teams are scanning 454 CCTV cameras to identify those involved in the violence,” says Kolar Superintendent of Police Karthik Reddy.

Editorial | Smouldering unrest: on Wistron plant issue

“Now my job is at stake and I am scared of police action though I was not on that shift. Many employees have left Kolar fearing arrest,” says Abhishek, who joined Wistron’s engineering department in June. Abhishek joined the company closer home after losing his job in Bengaluru during the COVID-19 lockdown. “We don’t know what is happening and we are not sure if we will be called back. So far, there has been no word from the company. But my overtime dues have been transferred to my account now,” he says.

Resentment building up

Many employees insist that the assembly line had become a tinderbox in the first week of October. Workers were divided into two shifts, with each shift working 12 hours a day for five days a week. In the earlier schedule, there were three shifts, with each working for eight hours a day for six days a week. To ensure a frenetic pace of production, the company went on a hiring spree. Incidentally, as part of its efforts to bring in more industry, the State government on May 22 introduced 10-hour shifts but later withdrew the order on June 12 after protests from unions.

As early as in the second week of November, production was affected briefly when employees stopped work at the assembly line for about an hour. Work resumed after line supervisors convinced employees to resume work, with the promise that their issues would be resolved. “Until October, we did not have any issue with our salary. If there was any problem with the punching machine, the problem would be rectified. However, the employee strength started increasing, and hundreds of new workers were added. The glitch in the punching machine was not fixed, and the information centre set up by the company to address these complaints could not handle the growing number,” says Abhishek. He also says that there was a huge difference between the salary offered and what the workers actually received. Overtime payment did not bring much relief, he says.

Employees claim that they were given notice about the increase in their shift time to 12 hours only about 10 days before the change was brought in. Already affected by COVID-19-related stress, this only added to their woes, they say. While each shift had two 30 minute-long breaks for meal times and two 15 minute-long tea breaks, employees took time to travel to and from the facility, which meant that they were out for about 15 hours everyday. “Some people had to travel from places as far as Chintamani, Mulbagal and Kolar Gold Fields, so it took them even longer. Employees had no life outside of work and would end up sleeping on their weekly offs. When we joined, we were not told about the 12-hour shift,” Abhishek says.

The major provocation for the violence on that day was the fact that the day shift employees knew how much salary they had received as they had got notifications on their phones but the night shift employees did not, and there were discrepancies in the salaries, claim workers. “I know my friends received only ₹300 and ₹600 as salaries for the full month of November. Overtime in October and November did not reflect in the salaries of many people. These people’s families depend on their salaries,” says Nithin, a B.Com graduate employed in the FATP department. As an incentive, the company had introduced a monthly attendance bonus of ₹1,000 for those who did not take any leave.

Excitement and disappointment

Months before the incident, the ₹3,000 crore investment by Wistron in Narasapura had caused great excitement among the youth in this district for two reasons. One, given that iPhones were to be assembled there, they knew that the facility would generate employment closer home. This meant that they didn’t have to go all the way to Bengaluru, 70 km away. As hiring started, young people below 25, from Kolar Gold Fields, Malur, Mulbagil, Hoskote, Kolar, Chikkaballapur and also Tamil Nadu and the northern States, landed contract jobs through staffing firms Randstad, Quess Corp, Innovsource, Creative Engineers, Needs Manpower Support Services, Adecco Group, and United (House Keeping). As local trains to Bengaluru from Kolar Gold Fields and Bangarapet were cancelled during the pandemic, a vital link to the capital for those commuting daily had been cut off. These people joined Wistron as they were offered transport facilities. With colleges closed, many students also joined the growing workforce. While no educational qualifications were specified for those joining the FATP department, only engineers were hired for the engineering department.

Police try to disperse protesters outside the Wistron Corporation’s iPhone manufacturing plant at Narsapura industrial area in Karnataka.

Police try to disperse protesters outside the Wistron Corporation’s iPhone manufacturing plant at Narsapura industrial area in Karnataka.  
| Photo Credit:
KPN

 

Abhishek says the job was not stressful. “The management was not pushing us to meet bigger targets. Many quit Honda Motorcycles and joined here because the job did not require physical exertion. Also, assembly lines were yet to stabilise so the assembly of iPhones had not reached the peak capacity. It all changed once the 12-hour shifts kicked in and overtime wages were not paid.”

Many violations

The violence triggered a series of investigations by government agencies. The preliminary inspection report by the Department of Labour shows that the Contract Labour (Regulation and Abolition) Act of 1970; the Minimum Wages Act of 1948 and Rules of 1958; the Equal Remuneration Act of 1976 and Rules, 1976; and the Industrial Employment (Standing Orders) Act of 1946, all of them crucial labour laws, were violated.

A separate report by the Department of Factories, Boilers, Industrial Safety and Health says that the increase in manpower in the factory from the license capacity of 5,000 to 10,500 was done within a short span of time. More serious was the move to increase working hours from eight hours to 12 hours on a continuous basis without informing the department and without seeking the necessary exemptions under the Factories Act for overtime work. It also found that there was no assessment of the repercussions of moving from eight-hour shifts to 12-hour shifts. The company was found not to have followed statutory compliance pertaining to the requisite number of safety officers, welfare officers, and medical officers as stipulated by the Factories Act.

Also read | Wistron put on probation, won’t get new biz from Apple before corrective actions are taken

At an internal meeting, the Labour Department found that no yardstick in terms of educational qualifications was provided: Pre-University Course graduates, Industrial Training Institutes graduates, diploma graduates, and B.E. graduates were all doing the same work for a monthly salary of ₹15,000. It was also found that without consent letters, women had been posted in night shifts.

The department noted that 1,343 permanent workers and 8,490 contract workers had been hired through six contractors. A glaring violation can be seen in this pattern, note trade unions, as there is a disproportionate number of contract workers compared to permanent workers. The Contract Labour Act of 1970 prohibits appointment of workers in jobs that are perennial in nature.

Acknowledgement and apology

On December 19, about a week after the incident, Wistron publicly acknowledged that some workers had not been paid correctly or on time and apologised to them.

“This is a new facility and we recognise we made mistakes as we expanded. Some of the processes we put in place to manage labour agencies and payments need to be strengthened,” it said in a statement. The company also said it was enhancing the processes and restructuring teams to ensure that such issues are not repeated. Hours later, Apple issued a statement further acknowledging the lapses. The smartphone major’s preliminary inquiry found violations of Supplier Code of Conduct. Proper working hour management processes had not been implemented, leading to payment delays for some workers in October and November. “We are disappointed and taking corrective steps to address these issues. Wistron is restructuring their recruitment and payroll teams at Narasapura,” Apple said. It also said that Wistron had been kept on probation and will receive no further orders until it completes corrective action.

Comment | The tightrope between production, industrial peace

Official response

Over the last two weeks, as the incident in Karnataka, a State that is otherwise regarded peaceful and investment-friendly, attracted international attention, the government has been on an overdrive to send a positive message to investors. Before the violence at Narasapura, on the other side of Bengaluru, workers were protesting against Toyota in Bidadi where a lockout has been declared in one of the plants. Government intervention has not brought relief.

In the aftermath of the violence, the government first said it would provide security to the company as thousands of jobs were at stake. Over the last few days, Ministers and top government officials have been tight-lipped about the issue. Their focus has been on restarting the facility at the earliest. In fact, despite Wistron and Apple acknowledging the workers’ problem publicly, the State government is yet to speak on the issues raised by the workers. The Union government is also keen on bringing the facility back on its feet, Chief Minister B.S. Yediyurappa announced. In the process, the information flow has been tightened and no official action has been announced yet on Wistron even as the company is focusing on re-starting operations. Labour officials say the company has submitted documents. Permanent employees have started going to the factory, while contract workers are yet to hear about their fate.

Comment | The fallout of keying in the wrong labour codes

Meanwhile, the Joint Committee of Trade Unions comprising eight unions told the State government that it is “a matter of great shame” that the supplier company, Wistron, and parent company, Apple, have shown the courage to admit mistakes, but the State government agencies, which are tasked with the welfare of workers, have no official response in this matter. The unions have also sought to be a part of the investigation team, and have told the government to treat the issue as a complex industrial relations issue and not a law and order one.

The names of the workers have been changed to protect their identity

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