Deck 3: Human Resources Management and Technology 

Question 1

Worker Exploitation at Foxconn/Hon Hai
Foxconn/Hon Hai Precision Ind. Co. Ltd. is a key China-based supplier to several U.S. high-tech companies like Apple, Dell, and HP. Manufacturers have a vested interest in the quality of products from their suppliers and their labor practices. Low-cost labor and a nearly endless supply of employees lead many U.S. companies to deal with suppliers in China. As more U.S. corporations strive for social responsibility, it was only a matter of time before production overseas saw the ripple effect of those decisions. Labor laws in China provide limited protection for workers and therefore the U.S. companies faced an ethical dilemma. Should they monitor labor practices at Foxconn/Hon Hai to ensure that workers were treated respectfully, or should they accept that if Foxconn followed Chinese labor laws it was not their concern?
Hon Hai, the world's largest electronics contract manufacturer, employs over 800,000 workers, who produce parts for iPads, iPhones, and other devices. Workers are housed in a campus with dormitories, a hospital, a bookstore, swimming pools, free bus transportation, and other services. Many of the workers migrated from farm communities to the industrial hubs where Hon Hai's operations are located. Their jobs at Hon Hai's factories are often the first assembly-line jobs they have ever held and they are frequently living far from home and family.
Working conditions at Hon Hai's factories complied with Chinese labor laws but frequently led to what is considered in the U.S. as worker abuse. Workers routinely worked in excess of 40 hours, with most workers averaging 120 hours of overtime per month. That calculates to an average workweek of 70 hours. Many machines were not properly equipped with safety devices leading to injuries. Underage workers were employed. At least 10 employees at the company committed suicide in 2010, which brought labor conditions under great public scrutiny. The company's response was to install safety nets around the dormitories to prevent additional casualties. The uproar from customers and the independent workeradvocacy agency, the Fair Labor Association, led to serious review of working conditions.
Apple had previously questioned labor conditions at Hon Hai. The company sent a team to investigate reports of excessive overtime and other "sweatshop" conditions. After the rash of suicides 'Apple sent a team of executives to China to inspect the factories and meet with Foxconn's CEO. Apple continues to monitor conditions at the supplier that were so bad that the U.S. company could no longer ignore the abhorrent labor practices.
Because of the sheer size of Hon Hai and its importance in the supply chain to electronics manufacturers, discontinuing the relationship would be a very difficult and costly alternative for Apple and others. Hon Hai has implemented a number of improvements for workers that should satisfy its customers and keep its employees safe and healthy. Employees at Hon Hai's factories will now work fewer hours and receive higher pay. For example, there is now a maximum 40-hour work week for each employee, with the option of working up to a maximum of 36 hours of overtime each week. The probation period for entry-level workers was cut in half from six months to three months. The company instituted an Employee Assistance Plan to assist employees with mental health concerns.
Labor laws around the world reflect the priorities of each nation's government and this can lead to great differences between countries. When a U.S.-based company does business with suppliers in other nations, one factor to consider is how workers are treated and what is required by law to insure humane working conditions. 69
QUESTIONS
1. What obligation does a company like Apple or HP have to insure that suppliers follow the local labor laws? What should Apple do if it discovers that the supplier is not in compliance with those laws?
2. How should a multinational company like Apple reconcile the differences in labor laws around the world? For example, workers in the United States are provided substantial protection from discrimination and unfair treatment. This is not the case in all nations. If a company like Apple is doing business with suppliers around the world, what standard should be used to evaluate labor practices?
3. As someone who might purchase devices made by Apple, Dell, or HP, how does this treatment of workers at a supplier influence your opinion of Apple and other U.S. companies that deal with such suppliers? Does Apple bear any responsibility for these labor problems because of its quest for ever lower costs?

Answer 1

The big names like A H can be of great importance to govern and ensure that the laws and labor conditions are followed at the suppliers end in other nations. They can work on agreements with their suppliers that the working conditions, pay etc will be better than those required in their nations. So that the best talent could be retained and also their motive of being socially responsible will be fulfilled.
Company's like A H can undertake regular inspections and visits at the supplier's site to ensure that the environment in these organizations is of good standard. They have to motivate their suppliers to provide better conditions and incentives to their employees for continuing business in larger volumes with them. They can train the suppliers HR at their own organizations to show them the levels used at their own company's and how benchmarks can be set by these suppliers.

Question 2

Discuss some of the protected characteristics covered by Equal Employment Opportunity and why they are important in today's employment setting.

Answer 2

Equal Employment opportunity refers to making of employment decisions by employers irrespective of some characteristics like age, sex, race, color, disability, religion etc. In this employer's follows a status blind approach wherein the decisions are made without considering the applicants' personal characteristics. These characteristics are also known as protected characteristics.
Protected characteristics refer to the attributes of individuals which are protected under equal employment opportunity laws regulations. Some of the characteristics covered are age, color, race, religion, disability, gender, national origin, pregnancy, Marital status etc. When making the employment the employer should treat all the applications received equally irrespective of these characteristics and selection should be based on skills, knowledge and experience of the applicant only.
They should not indulge in practices like preferring single over marries or giving more preference for a job to a particular religion etc. Similarly pregnant woman should be treated equally, this law does not even say of providing any favors even for anyone. Because of globalization today world is small and the workforce is also diversified, more woman, people from different caste, religion nationalities, gender are entering the corporate world which requires fair treatment. Thus these laws are more needed in today's time.

Question 3

Because of a large number of recently retired employees you have been hiring more employees in recent years. The average age of the workforce at your company has changed drastically. The typical age of your employees used to be around 40; however, after many recent additions, it is now 34. The president of the company is worried that the company culture no longer matches up with the needs and values of a younger workforce. As the HR manager you have individually met with every new employee for orientation over recent years, so you feel you have a good idea as to what your workforce is looking for. You have been asked by the company president to suggest a few options to help increase morale and entice employees to stay with the company.
1. List some ideas to help meet the needs and wants of a younger workforce.
2. Going forward, what type of program would you include as part of new employee orientation to help further "sell" the company to your new employees?

Answer 3

To make an organization successful it is necessary that the workforce should be satisfied. As described in the case the Average age of the workforce has decreased from 40 years to 34 years and as an HR manager it is needed that steps should be taken in this regard to meet the needs and wants of the younger workforce in the organization.
The important thing to consider here is that according to the Equal Employment opportunity the factors like age, race, religion, gender etc are the protected characteristics and employment decisions should be taken without considering these factors, based on skills, experience and knowledge of the applicants.
The HR could design the policies which takes all the rules and regulations in consideration and at the same time meets the needs and wants of young employees. They can use surveys, one on one feedback to understand what motivates them for example introducing flexibility, pay for performance incentives etc can be included. They should also make the new employees understand the culture, rules and regulations as required to be followed in the organization.

Question 4

You recently learned that two of your key female employees will be taking maternity leave around the same time. What procedures or rules do you need to be aware of based on the Pregnancy Discrimination Act (PDA)?

Question 5

Give an example of sexual harassment you may have witnessed or heard about. How do you think the situation should have been handled if you were the HR manager?

Question 6

Use the U.S. Department of Labor website (www.usdol.gov) to further research a topic discussed in this chapter. Be sure to understand what the particular law (Act) is protecting and what the rules are that companies need to follow to comply with this Act.