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China Watchdog Group: Amazon’s Gain Is Workers’ Pain

A U.S. watchdog group found infractions at Foxconn's Kindle factory.

A U.S. watchdog group, China Labor Watch, has accused contract manufacturer Foxconn of labor violations at its Hengyang plant, which produces Kindle e-readers, Echo Dot smart speakers and Fire tablets for Amazon.

The charges, which stem from an eight-month-long investigation, include inadequate training, unpaid sick leave, penalties for time off, verbal abuse, insufficient protective equipment, inadequate fire safety measures in the dormitories, and forced overtime, with employees in one instance working 14 consecutive days.

The findings were published in a 94-page report.

Foxconn, whose formal name is Hon Hai Precision Industry Co., gained notoriety in 2010 when harsh work rules were believed to have contributed to a series of suicides at its factories where iPhones were produced.

China Labor Watch said the abuses at the Amazon plant stem largely from excessive use of seasonal, or “dispatch,” workers, in violation of China’s labor laws. The temp workers are paid less and receive fewer benefits than full-time employees, which lowers Foxconn’s labor costs.

The New York-based organization called on Amazon to exert its influence on Foxconn to improve conditions at the factory. “Amazon’s profits have come at the expense of workers who labor in appalling working conditions and have no choice but to work excessive overtime hours to sustain a livelihood,” the group said.

Amazon told Reuters that it had found “issues of concern” after auditing the plant in March, and “immediately requested a corrective action plan from Foxconn.”

Foxconn said in a statement to Reuters that it is conducting “a full investigation” and would take “immediate actions” if the allegations proved true.

Foxconn is the world’s largest CE contract manufacturer, making everything from iPhones to PlayStations for others. But the Taiwanese business has moved aggressively into the OEM space, beginning with its $3.5 billion, 66 percent stake in Sharp two years ago, and its $866 million buyout of Belkin in March.

See: Foxconn Buys Majority Interest In Sharp

The company is scheduled to break ground on its first U.S. factory, an LCD plant in Wisconsin, later this month. President Trump reportedly plans to attend the ceremony.