Apple pulls up Wistron for holding back wages at Karnataka factory

US tech giant Apple Inc on Saturday said it had placed contract manufacturer Wistron on probation and would not give the Taiwanese firm new business until it took corrective actions following lapses at its plant in Karnataka.

Apple said in a statement that its probe into the issue has shown that Wistron failed to implement proper working hour management processes which “led to payment delays for some workers in October and November” at the plant in Karnataka.

Apple said that this constituted violations of its ‘Supplier Code of Conduct.’ The US tech giant will continue to monitor Wistron’s progress on corrective action. “Our main objective is to make sure all the workers are treated with dignity and respect, and fully compensated promptly.”

In a statement earlier on Saturday, Wistron admitted some workers at its plant in Karnataka’s Kolar district had not been paid properly and said it was sacking a top executive overseeing the Indian business.

Contract workers angry over unpaid wages destroyed property, factory gear and iPhones at the plant last week causing losses to the tune of Rs 25 to 30 crore to the Taiwanese contract manufacturer and forcing it to shut the plant. The workers had gone on the rampage as as the factory management had refused to pay them for the overtime work that they were made to do.

The plant near Bengaluru assembles one iPhone model, and had started functioning earlier this year.

“This is a new facility and we recognise that we made mistakes as we expanded,” Wistron said in the statement. “Some of the processes we put in place to manage labour agencies and payments need to be strengthened and upgraded.”

An inspection of the plant by Karnataka officials after the violence, also showed that Wistron could not cope with the rapid scaling up of manpower and broke several laws at this factory..