With his positive initial comments from Auret van Heerden, head of the FLA (Fair Labor Association) was surprising most analysts and news networks. As a reminder, the FLA has been commissioned by Apple for auditing working conditions in Foxconn and other Apple's partners production plants
According to Bloomberg, things have changed and evolved and Auret van Heerden now indicates that they have uncovered "tons of issues" that need to be addressed by Foxconn in its plant in Shenzhen.
The FLA expects to release more details on its inspections in the coming weeks, and van Heerden to already announce already that "I believe we’re going to see some very significant announcements in the near future".
It it turns out that Foxconn needs to dramatically improve working conditions, Apple might try to play the victim, however in a relation between two companies, it is not necessarily always black and white. For sure, any major issues at Foxconn production plants will fuel current on-going pressure in USA for pushing Apple to relocate part of its production in USA. Apple might have to take decisions that will have impacts beyond the pure business field. Apple recently decided to invite ABC teams to visit some of production lines, however, we all know that it is very difficult to get hones and clear statement of workers on-site, and it would be more informative to talk to workers in their homes or other off-site locations.
Coming as a surprise, Reuters reports that Foxconn announced a new wage increase for its entry-level workers at all facilities in China. This is a 16-25% increase, and it would be hard to think it is not linked to the current on-going investigation. OVer the last three year, this is the third increase, doubling the pay of of entry-level workers during the same time period.