Case Study 4

Riot Puts Spotlight on Working Conditions

The Han Hoi riot started as a minor fracas between two young workers, but soon escalated into a pitched
battle that involved over 2,000 employees and 5,000 paramilitary forces. The two workers, who
everyone agrees started the riot, were from different regions and had just got off a stressful 12-hour
shift at the factory that makes iPods and iPads. The work was boring and low paid, and frustrations
boiled over when a small argument turned into a shoving and pushing match. Witnesses claim that
security workers at the plant over-reacted to the incident, and began brutally beating the two young
people.

At that point, hundreds of workers rushed the security personnel and returned the favour. Soon, more
and more security personnel were called to the scene, followed by more and more restive workers. A
major revolt was under way and when it was over, 40 people were hospitalized and the facility had to
be shut down for days after fires and looting left many stretches of the campus that housed close to
80,000 workers gutted. Also, when it was over, questions started to be raised about the changing nature
of the Chinese workforce and how these changes are challenging the business model that underlies all
of Chinese manufacturing.

Specifically, the riot put a spotlight on the tension between Chinese factories that base their business
model on low-cost strategies that create low-scope jobs and unpleasant working conditions, and a new
generation of Chinese workers who seem less willing tolerate those conditions. For example, one
worker who was involved in the riot spoke for many when she stated that “some people are just not
satisfied that Foxconn pays us so little and asks us to work long hours.” More broadly, the Chinese
Labor Buletin, which tracks strikes and labor protests, reported 30 such incidents in 2012, up
dramatically from the 10 reported just one year earlier.

Foxconn had already been at the center of controversy in 2009, when so many workers began
committing suicide at the plant that security had to install nets to the sides of buildings in order to catch
workers attempting to jump to their deaths. Foxconn reacted to these incidents by increasing wages and
improving working conditions, but clearly the changes did not go far enough. The same frustrations
seem to be in place, but this time, the workers are taking out their frustrations on their employer rather
than themselves. They thought of this for an employer managing over 1 million restive workers is
sobering and Han Hoi spokesman Louis Woo summed up the experience by noting that “we cannot
argue that manufacturing jobs are exciting for workers. It’s kind of boring and requires a lot of hard
work, so we may have to change that rather than hoping the workers will change.”

(Adopted from Noe, A.N., Hollenbeck, J.R., Gerhart, B. & Wright, P.M. (2015). Human Resource Management.
Global Edition. New York. McGraw-Hill International Edition, p473.)