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Foxconn raises base wages, reduces overtime hours

By Huang Yuli (China Daily)

09:20, February 23, 2012

SHENZHEN, Guangdong - Foxconn announced on Monday it is raising the base wages of its workers on the Chinese mainland by 16 to 25 percent as of Feb 1 and will reduce the number of extra hours they may work.

Liu Kun, Foxconn spokesman, said the rate of the pay raises will differ according to the job location and description and the workers' skills.

The base pay for a new assembly line worker in Shenzhen, for example, will increase from the current 1,550 yuan ($246) a month to 1,800 yuan, and after passing a six-month evaluation, that worker will earn a monthly base salary of 2,200 yuan instead of the current 2,000 yuan.

Liu said this is the third wage increase since the first of several Foxconn employee suicides - on Jan 23, 2010 - when the base pay of workers at the factory was 900 yuan.

"We are increasing the base pay to ensure that our workers' earnings will not drop much when their overtime hours are reduced. In this way, we hope to keep the good, qualified workers. Though the pay raises will definitely increase our costs, they will help save on recruitment expenses and lower the defect rate of our products."

He said the policy has been made known and already has taken effect with new Foxconn employees. The other workers will learn how much of a raise they are getting when they get their February salaries on March 10.

According to Liu, the raise was a decision made by Foxconn's trade union, the workers and the management at the end of December. It was the second year Foxconn adopted such a negotiation system on wages.

He said Foxconn will not permit employees to work more than 60 hours a week, or a total of 80 extra hours a month. The company will try to gradually lower the limit to a maximum of 36 extra hours a month, he said, and the company will increase its supervision of hours worked.

"Since we have more than 1 million employees, it is important to make sure the policies set at headquarters are observed by all groups. Workers can complain to the trade union through the hot line 78585."

Liu also responded to the Fair Labor Association's audit financed by Apple.

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