The incident at its iPhone manufacturing plant in Kolar will not cause significant impact to the company, Wistron said in a regulatory filing with the Taiwan Stock Exchange. On December 12, thousands of workers at the plant in Kolar, Karnataka went on a rampage in anger over unpaid dues and delayed payments.
In the filing Wistron said that the Narasapura plant is new and that the quantity of shipment from there is still small, thus not causing significant impact. This statement came as the company was disclosing to the exchange that it was placed on probation by Apple.
“Regarding the event at our Narasapura facility in India, the investigation which includes collaboration with related government authorities is ongoing, as well as related insurance claims. The company will work with our customer in terms of correcting issues and operation recovery,” Wistron said.
Wistron Corp had initially pegged the damage at the plant due to violence at Rs 437 crore, and then drastically pared it down to Rs 26-52 crore.
“Regarding the damage to our Narasapura facility in India, the company is assessing the extent of the damages in various areas of the facility’s campus. Unlike earlier reports stated, the violence did not cause any material damage to major manufacturing equipment and warehouses, with preliminary estimates of damages in the range of NTD 100 to 200 million,” Wistron said in the filing on December 15.
Following an investigation, Apple on Saturday placed Wistron on probation for violating its ‘Supplier Code of Conduct’ by failing to implement proper working hour management processes, which led to delay in payments to some workers in October and November. This means that Wistron will not receive any new business from Apple before corrective actions are completed.
“As always, our focus is on making sure everyone in our supply chain is protected and treated with dignity and respect. We are very disappointed and taking immediate steps to address these issues,” Apple said in a statement on Saturday.
Wistron, too, admitted to lapses at the plant and said that its investigation into the issue found that some workers were not paid correctly, or on time. Wistron apologised to workers and said that it removed Vincent Lee, Vice President (innovation business group) of Wistron Infocomm Manufacturing India as a disciplinary measure.
It started settling dues of most workers on Saturday. Employees told TNM that most of them received their outstanding pay and that the company has promised to pay the rest.
Wistron said that it is enhancing processes and restructuring its teams to ensure these issues are not repeated. The company also set up a 24-hour grievance hotline in Kannada, Telugu, Tamil, Hindi and English to ensure workers can voice any concerns they may have, anonymously.