Apple’s major supplier Foxconn (2317.TW) said on Thursday a “technical error” occurred when hiring new recruits at a COVID-hit iPhone factory in China and apologised to workers after the company was rocked by fresh labour unrest.
Men smashed surveillance cameras and clashed with police as hundreds of workers protested at the world’s biggest iPhone plant in Zhengzhou city on Wednesday, in rare scenes of open dissent in China sparked by claims of overdue pay and frustration over severe COVID-19 restrictions.
Workers said on videos circulated on social media that they had been informed that Foxconn intended to delay bonus payments. Some workers also complained they were forced to share dormitories with colleagues who had tested positive for COVID.
“Our team has been looking into the matter and discovered a technical error occurred during the onboarding process,” Foxconn said in a statement, referring to the hiring of new workers.
“We apologise for an input error in the computer system and guarantee that the actual pay is the same as agreed and the official recruitment posters.”
The largest protests had died down by Thursday and the company was communicating with employees engaged in smaller protests, a Foxconn source familiar with the matter told Reuters.
The person said the company had reached “initial agreements” with employees to resolve the dispute and production at the plant continued on Thursday.
The Taiwanese company said it would respect the wishes of new recruits who wanted to resign and leave the factory campus, and would offer them “care subsidies”.
In the videos circulating online on Wednesday, some workers complained they were never sure if they would get meals while in quarantine at the sprawling industrial campus in central Henan province.
“Foxconn never treats humans as humans,” one person said.
China on Wednesday reported a record of 31,444 new daily cases of locally acquired COVID, up from the previous peak of 29,317 on April 13.
Foxconn shares fell 0.5 percent on Thursday morning, versus a 0.5 percent gain in the broader market (.TWII).
The Zhengzhou plant employs more than 200,000 people to make Apple Inc (AAPL.O) devices including the iPhone 14 Pro and Pro Max.
Apple said it had staff at the factory and was “working closely with Foxconn to ensure their employees’ concerns are addressed”. The factory accounts for 70 percent of iPhone shipments globally.
Reuters earlier reported that iPhone output at the Zhengzhou factory could slump by as much as 30 percent in November following worker unrest last month, and that Foxconn aimed to resume full production there by the second half of the month.
Apple has warned it expects lower shipments of premium iPhone 14 models than previously anticipated. Wedbush Securities analyst Daniel Ives expects the shutdowns to cost Apple about $1 billion a week in lost iPhone sales.
The factory has been rocked by worker unrest and discontent since October, due mainly to strict quarantine rules, repeated COVID outbreaks and poor conditions including food shortages.
Some staff fled the campus rather than submit to Foxconn’s so-called closed loop system, which requires workers to live and work on site and isolate themselves from the outside world.