Apple puts iPhone assembler Wistron on probation over India factory riot

Saturday's riot at Wistron's iPhone production facility in Narasapura, India continues to cause problems for Wistron. Following the damage caused to the factory through the violence, as well as state authorities determining it had broken labor laws, Wistron now has to contend with a loss of income from its client, Apple.

In a statement received by the Hindustan Times, Apple says its employees and independent auditors have conducted an investigation into the facility. While the investigations are "ongoing," preliminary findings have uncovered violations of Apple's Supplier Code of Conduct, in that Wistron failed to "implement proper working hour management processes."

Assuring that it wanted to make sure "everyone in our supply chain is protected and treated with dignity and respect," Apple says it is "very disappointed," and is "taking immediate steps to address these issues." This includes Wistron taking disciplinary action, a restructuring of recruitment and payroll teams, and the setting up of an employee assistance program and grievance hotline.

Furthermore, Apple has "placed Wistron on probation," meaning it won't gain any new business from Apple until it performs "corrective actions" monitored by Apple and independent auditors.

In its own statement, Wistron said "Since unfortunate events at our Narasapura facility, we have found that some workers were not paid correctly, or on time. We deeply regret and apologize to all of our workers. Safety and well being of our team members is always our top priority and core value."

Wistron confirmed it was restructuring its teams, including the removal of its Vice President overseeing its operations in India.

The full statement from Apple follows:

Apple employees and independent auditors hired by Apple have been working around the clock to investigate the issues which occurred at Wistron's Narasapura facility. While these investigations are ongoing, our preliminary findings indicate violations of our Supplier Code of Conduct by failing to implement proper working hour management processes. This led to payment delays for some workers in October and November.

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. Wistron has taken disciplinary action and is restructuring their recruitment and payroll teams in Narasapura. They have also set up an employee assistance program and a 24-hour grievance hotline in Kannada, Telugu, Tamil, Hindi, and English to ensure all workers at the facility can voice any concerns, anonymously.

We have placed Wistron on probation and they will not receive any new business from Apple before they complete corrective actions. Apple employees, along with independent auditors, will monitor their progress. Our main objective is to make sure all the workers are treated with dignity and respect, and fully compensated promptly.