A member of a labor group places a lily on the street to mourn the deaths of Foxconn employees, who have committed suicide this year, during a protest outside Hong Hai Precision Industry, the parent company of Foxconn, in Taipei, on Friday. [Chiang Ying-ying / AP]
SHENZHEN - Taiwan's Hon Hai Precision Industry said on Friday it will raise the pay of its workers at its mainland Foxconn unit by an average of 20 percent, a move that follows a spate of suspected suicides at the company's production bases.
Salary jumps at Foxconn Technology Group have been in the offing for months to cope with a labor shortage following the mainland's recovery from the global recession, a company official said on condition of anonymity.
The official said the big jump in pay could help lift the morale of the workers.
"Sadness is contagious, and so is happiness," he said, adding that with the increase in salaries, "we hope the workers will see the positive side of life".
The announcement of an increase in the workers' salaries comes a day after Foxconn reported its 13th suicide attempt case this year at its Shenzhen plants.
At around 4 am on Thursday, an employee surnamed Chen, 25, a native of Hunan province, slashed his wrist. Chen, who joined Foxconn in March this year, survived after receiving medical treatment.
The incident occurred just a day after Foxconn president Terry Gou called a press conference and publicly apologized for the series of deaths and promised to prevent more such cases.
Gou also appealed to the media to play down coverage of the suicides to prevent more from happening.
Following the press conference, safety nets were installed in all dormitory buildings of the company's Shenzhen factory and counselors were being hired to boost the morale of the workers.
Gou also said all employees had been divided into 50-member groups, whose members would watch for signs of emotional trouble among workers.
All attempts to contact Foxconn's Shenzhen office for comments on the pay increase failed.
But Hon Hai spokesman Edmund Ding denied on Thursday that the pay increase is a result of the suicides.
He said from Taipei that the plan had been in place for some time and was implemented because the economy was now recovering.
According to the plan, the basic salary for a junior level worker will be raised to 1,100 yuan a month from the current 900 yuan. And the overtime pay will be doubled.
About half of its more than 400,000 employees will benefit from the plan.
As a result, Foxconn will pay an extra of 420 million yuan every month in salaries, more if overtime is counted.
Citi Bank estimated that Foxconn will see a 10 to 12-percent reduction in profit.
The frequent suicide attempts at Foxconn have thrown the spotlight on the labor practices of the company, whose clients include Apple, Dell, Hewlett Packard and Sony Ericsson.
Apple and other clients have said they are investigating the working conditions at Foxconn, which has some 420,000 employees at its bases in Shenzhen.
AP contributed to the story.
