Labor abuses still bedevil Taiwanese firms abroad.
Quanta Computer on Wednesday last week posted third-quarter sales of NT$276.17 billion (US$9.16 billion), an improvement of 17.33 percent over the previous quarter and almost 24 percent from the same quarter last year that one company official attributed to “better-than-expected notebook shipments and strong orders for servers.”
However, no mention was made of allegations about money the company is saving by having teenage vocational-school students work as “interns” on the company’s production lines in Chongqing, China.
Students and Scholars Against Corporate Misbehavior (SACOM), a 12-year-old Hong Kong non-profit group, on Sept. 22 reported on what it said were abuses of young students at the factory, where it said more than 60 percent of workers were interns, even though Chinese labor laws state that interns should not exceed 10 percent of a factory’s workforce.
SACOM said that undercover research and interviews at the factory from late last year through the middle of this year found about half of the workforce is made up of students on three-month internships, who were working 12-hour shifts for months at a time without days off for a little over US$250 per month.
Some of the students had been hired, illegally, through recruitment agencies, some had to pay deposits to their schools to receive an internship, while others were forced by their schools to work at the factory under the threat of not being able to graduate or having their room and board subsidies cut, it said.
The SACOM report and allegations were on Oct. 6 covered by the Guardian on its “Modern day slavery in focus” Web site.
The Guardian said that Quanta Computer had denied the report’s allegations, calling them “untrue and unfair to the company. There are serious mistakes in the information... from the undercover investigators.”
Quanta did not specify what those mistakes were, the newspaper said.
However, Quanta’s denials come up against a sorry history of labor abuses by Taiwanese-owned firms in China and elsewhere, be it a wave of worker suicides at Hon Hai Precision Industry Co’s (Foxconn) Long-hua factory in Shenzhen, China, in 2010; reports of violent discipline and summary dismissals by Ho Hing clothing workers in Cambodia in 2010; physical abuse reported by Indonesian workers at a Pou Chen Group factory in Sukabumi and a PT Amara Footwear factory outside Jakarta in 2011; or Vietnamese protesting against Hong Fu Vietnam Footwear Co in 2015.
It is also not the first time that a Taiwanese company has been accused of misusing student interns in China. Such allegations were first raised in 2012, when Foxconn was reportedly using students on forced internships to assemble iPhones.
Those reports were supposed to have led to Chinese labor laws being tightened to require internships to be directly related to students’ course of study. However, if SACOM’s allegations are true, these regulations continue to be widely flouted.
Many Taiwanese companies began relocating to China and Southeast Asia more than two decades ago, looking for cheaper land and lower labor costs. However, truth be told, many were also seeking to escape the increasingly strict environmental protection and labor regulations being passed in Taiwan.
In the intervening years, they have been faced with demands for higher wages, both by workers and by local governments, while the low-margin economies of scale of contract manufacturing are squeezing already small profits. It is a difficult cycle to break.
As the government pushes its New Southbound Policy to expand the nation’s export markets, diversify its products and encourage more Taiwanese companies to invest in the region, it is worth reminding corporate leaders — and government officials — that the practices of companies reflect not only on themselves, but also on this nation.
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