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Apple supplier Foxconn closes plant after riot

Tags: Apple
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Taiwan's Foxconn Technology Group, which assembles Apple's (AAPL-Q) iPhones and makes components for top global electronics companies, closed a plant in northern China on Monday after about 2,000 workers staged a riot at a company dormitory.

It was not immediately clear how long the shutdown would last at the plant, which employs about 79,000 people in the Shanxi provincial capital, while police and company officials investigate the cause of the disturbance.

"The plant is closed today for investigation," Foxconn spokesman Louis Woo told Reuters, but a company employee contacted by phone said the closure could last two or three days.

The unrest is the latest in a string of incidents at plants run by Foxconn, the trading name of Hon Hai Precision Industry Co and the world's largest contract maker of electronic goods. Hon Hai's Taipei-listed shares fell 1 percent on Monday in a broader market that rose 0.2 percent.

Drawing attention as a supplier and assembler for Apple products, the company has faced allegations of poor conditions and mistreatment of workers at its operations in China, where it employs a total of about 1 million workers.

The company has been spending heavily in recent months to improve the work environment and to raise wages.

In a statement on Monday, Foxconn said the incident escalated from what it called a personal dispute between several employees at around 11 p.m. on Sunday in a privately managed dormitory, and was brought under control by local police at around 3 a.m.

"The cause of this dispute is under investigation by local authorities and we are working closely with them in this process, but it appears not to have been work-related," Foxconn said.

Online comments, however, suggested security guards may have been to blame.

In a posting on the Chinese Twitter-like microblog site Sina Weibo, a user "Jo-Liang" said that four or five security guards beat a worker almost to death, while another user, "Fan de Sa Hai", quoted a friend from Taiyuan as saying that guards beat up two workers from Henan province, which led other workers to set quilts on fire and toss them out of dormitory windows.

The accounts could not be independently confirmed.

China's Xinhua news agency quoted a senior official with the Taiyuan city government as saying investigators initially determined the fight broke out as workers from Shandong Province clashed with those from Henan Province.

The agency reported earlier that some 5,000 police were sent to quash the violence, according to Taiyuan City's public security bureau.

Foxconn cited police as saying 40 people were sent to hospital and a number were arrested, while Xinhua added that three were in serious condition.

Calls to the Taiyuan police were not immediately answered, while an official at the plant declined to comment when reached by telephone.

"Clearly there is deep seated frustration and anger among the employees and no outlet, apart from violence, for that frustration to be released," Geoff Crothall, communication director at China Labour Bulletin, a labour rights group in Hong Kong, said in a statement.

"There is no dialogue and no means of resolving disputes, no matter how minor. So it is not surprising when such disputes escalate into violence."

Foxconn does not confirm which of its plants supply Apple, but an employee told Reuters that the Taiyuan plant is among those that assemble and make parts for Apple's iPhone 5.

In June, about 100 workers went on a rampage at a Chengdu plant in southwestern China.

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