Wistron sees no major impact of Karnataka plant vandalisation on company

Topics Wistron | Apple  | iPhone SE

Wistron has admitted to lapses in payment of wages to employees and assured full compensation to them
Taiwanese major Wistron, whose iPhone manufacturing plant was vandalised earlier this month over wage issues, has said that the incident will not impact the company significantly.

“As the Narasapura facility is a new operation and the shipment quantity is still small, the incident will not cause significant impact to Wistron,” it said in a statement to the Taiwan Stock Exchange. The company had pegged the damages during the riot at Rs 50 crore. It also manufactures Microsoft and Lenovo products at the factory.

Technology major Apple had said on Saturday that it will not provide new business contracts to Wistron globally until the Taiwanese manufacturer completes all corrective actions at its Narasapura facility, around 60 km from Bengaluru. Wistron refused to comment on this development. The company will continue to make iPhone SE and iPhone 7 models at the unit. “The programmes that have been initiated before the Narasapura issue remain,” said a source.

Wistron has admitted to lapses in payment of wages to employees and assured full compensation to them. It has also removed its vice president, Vincent Lee, who used to oversee the business in India. Expressing disappointment, Apple said its focus is on making sure everyone in the supply chain is protected and treated with dignity and respect.

Wistron, which had only 2,000 employees till June, had added around 10,000 more within the next few months on a contractual basis as Apple began gearing up for direct online sales of its flagship products in India.

“This is a new facility and we recognise that we made mistakes as we expanded,” said Wistron. 

An initial  government report pointed out that Wistron’s HR department was not adequately set up with personnel of sound knowledge of labour laws. The factory has adopted two shifts of 12 hours per day system from October 4, with three breaks of half an hour each in each shift. “The confusion in the minds of the workers about their wage inclusive of overtime on account of the change in work pattern from 8 hour shift to 12 hour has not been addressed properly by the HR personnel in line with the legal provisions of law,” said the report submitted by the department of factories, boilers, industrial safety & health.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel