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Electronics Organizing and fighting against precarious 1

The industry is The supply chains that feed the electronics rapidly increasing numbers of agency, industry are getting bigger and more contract and outsourced workers, as well one of the largest industrial complex as pervades every as migrants, who have little or no chance sectors in the global economy. area of our lives. Apple deals with over to bargain collectively on their terms and 750 suppliers to make products such as conditions of employment. As society is increasingly iPhones and iPads, and in the automobile Shoji Arino, chairperson for IndustriALL industry, electronic components can smarter and digitally ICT Electrical and Electronics, says the make up to 40 per cent of total costs in connected, it continues sector’s business model not only increases all car categories. It is estimated that the precarious work, but also leads to to boom. electronics industry employs 18 million* disparities in standards of living and a crisis workers worldwide. in sustainability: Highly competitive, innovative, fast “Governments and multinationals in changing and with short production cycles, the electronics sector are employing the electronics industry mostly operates on nefarious tactics to obstruct trade union a ‘just-in-time’ production model, fuelling a activities, especially in Asian developing rise in precarious work. countries. We, as unions in this sector, In 2014, IndustriALL’s ICT Electrical and must take wide-ranging action to Electronics sector conducted a survey combat them.” 1 Assembly lines for mobile phones in China. SOMO on precarious work in the industry. The 2 Assembly line at factory. SOMO results show that permanent workers are 3 An employee for Flextronic in Guadalajara, Mexico, being pressured into precarious positions. works on a circuit board. SOMO Unions are struggling to reach out to the

* A study conducted for the International Labour (ILO) Better Work Program in 2010 estimated the number of workers in the electronics industry at 18 million. 5 global worker | report

Ducking international labour standards The world’s five highest earning electronics companies originate from countries where the ILO conventions on freedom of association (ILO convention No.87) and the right to collective bargaining (ILO convention No.98) are not ratified. They Highly competitive, also operate in and/or outsource labour intensive production processes to suppliers innovative, fast changing located in countries where these ILO and with short production conventions are not respected (Tables 2 and 3). In the labour intensive production cycles, the electronics processes of the electronics industry, the industry mostly operates on workplaces have very low or no union a ‘just-in-time’ production density. Many workers are forced into a precarious working environment weakening model, fuelling a rise in their chance to bargain collectively. precarious work. Foxconn, Apple’s biggest supplier, has 2 grown massively since the company began operating in mainland China in 1988. In 15 years, the company has become ASEAN and India - hot spots ASEAN countries and India are helping one of the world’s biggest electronics of production to attract foreign investment by offering manufacturers, employing more than 1.2 special incentives to electronics MNCs. million workers worldwide. The company China, once the world’s electronics Companies are rushing to India and the production hub, is now losing out to has had many serious labour problems ASEAN countries to take advantage of the related to working conditions – low wages, South East Asia and India. Multinational lower costs and attractive Companies (MNCs) are shifting production long working hours, irregular work-loads, investment conditions. As a result of the huge use of agency workers outside of to ASEAN countries, such as Malaysia, Vietnamese government’s preferential Indonesia, Philippines and Vietnam, as well China – and occupational health and safety treatment towards Electronics, (OHS). In the absence of trade unions in as India, where wages for manufacturing in 2014 the company built the world’s workers are lower than in China (Table 1). the workplace Foxconn has faced riots by largest smart phone factory in the country. groups of unorganized workers. 62 per cent of TV (LCD, LED), 70 per cent Samsung will employ 100,000 workers of , 76 per cent of car by July 2015, making it the largest foreign Samsung, the biggest selling electronics navigation systems, 86 per cent of mobile/ company in Vietnam. Foxconn is planning to company in the world, has a long history smart phones, and 100 per cent of digital invest US$1 billion in a manufacturing project of disrespecting labour and human rights. are manufactured in Asia. in Indonesia, estimated to create more than Samsung’s violations of workers’ rights 100,000 jobs in the coming years. range from kidnapping and battering of union leaders, to special training for managers to implement an effective “union- Table 1: Standard wages of manufacturing workers in Asia free” policy, as evident in Korea and other (2013, in US dollar/month. Green: engineer. Yellow: production workers) countries in Asia. Who wins with the electronics business model? Top from the leading electronics companies are ranked among Electronics production the richest people in the world. Samsung’s is shifting to ASEAN + India chairman, Lee Kun-hee, has an estimated net worth of US$12.6 billion; Apple CEO Tim Cook took home a salary of more than US $9 million last year. Hewlett-Packard CEO Meg Whitman, got a pay package of Low wages + government US$19.6 million in 2014, and the CEO of incentive for foreign investment Hon Hai Precision (Foxconn), Terry Gou, has in electronics sector a net fortune estimated at US$6.1 billion. This stands in contrast to standard Foxconn workers in China assembling products for Apple and HP. They are paid on average US$5,000 dollar per year, which means Foxconn’s CEO is worth more money than the combined annual 0 500 1000 1500 2000 2500300035004000 salary of all the company’s one million blue- Source: Selected data from Japan External Trade Organization (JETRO). collar workers.

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Table 2: Selected large electronics firms (2013-2014) Organizing in the electronics industry Company Annual revenue Employees Country origin In 2013, IndustriALL set up a steering (US$ million) committee on ICT Electrical and Electronics 220 185 286 284 Republic of Korea to lead the work in the sector and discuss strategies on MNCs, trade union networks, Apple 170 910 80 300 USA GFAs, organizing, union rights, precarious Foxconn 131 138 1 200 000 Taiwan-China work and specific industrial policy. Hewlett-Packard 112 298 317 500 USA In 2014, a five-year project supported by IBM 99 751 431 212 USA the European Commission was launched in cooperation with the GoodElectronics Hitachi 95 988 320 725 Japan network. It focuses on organizing Microsoft 86 833 128 000 USA electronics workers in the ASEAN region, Corporation 71 509 140 900 Japan of which 30 per cent are women, including outsourced workers, temporary workers, 71 331 271 789 Japan migrants and students. Last year, over 600 Source: “Issues paper for discussion at the Global Dialogue Forum on the Adaptability of Companies to Deal with Fluctuating Demands and the trade unionists from IndustriALL affiliates in Incidence of Temporary and Other Forms of Employment in Electronics”, International Labour , December 2014. Indonesia (FSPMI and Lomenik), Malaysia (EIWU and EIEU coalition), Thailand Table 3: Ratification of ILO fundamental conventions by countries where major electronics (TEAM), Vietnam (VUIT) and Taiwan MNCs are located (Green: not yet ratified. Yellow: ratified) (ROCMU) were trained in organizing.

C087 C098 C029 C105 C100 C111 C138 C182

EU United States It is the first time the union China has negotiated a collective India bargaining agreement that Indonesia includes migrant workers. Japan Korea, Republic of Concrete results have already been Malaysia achieved. In Malaysia, EIEU Northern Philippines region has succeeded in organizing more than 900 workers at an electronics MNC Singapore despite strong resistance and union Thailand busting tactics by the management. It Vietnam is the first time the union has negotiated a collective bargaining agreement that Source: ILO NORMLEX. includes migrant workers. This year, IndustriALL will expand the project to the Despite the fact that IBM recently employment in the sector. The numbers Philippines where the electronics industry announced plans to lay off more than of unorganized and precarious workers is expected to grow significantly in the 100,000 employees (25 per cent of the are growing in the complicated supply country’s export processing zones over the total workforce) in 2015, the company’s chain system. Unions must fight back by next three to five years. CEO, Virginia Rometty, got a pay package organizing and fostering strong negotiation worth more than US$20 million last year, skills among workers. Global campaign defeats including a US$3.6 million bonus. Over the last few years, IndustriALL union-busting attack The worker unfriendly business model affiliates and the All China Federation of Locking out or dismissing union leaders adopted by major players in the electronics Trade Unions (ACFTU) have succeeded by picking holes in vague labour laws industry has had a negative influence on in organizing Foxconn workers. Collective are typical union-busting tactics used organized workplaces and sustainable bargaining with management has led to by electronics companies in the course improved working conditions and OHS at of collective bargaining. In May 2014, organized workplaces in China and Brazil one of Apple’s most important suppliers, Kan Matsuzaki, Director of ICT Electrical NXP Semiconductors, dismissed all 24 and Electronics at IndustriALL, says elected union officials from IndustriALL that these successful cases and models affiliate MWAP at its plant in a special should be developed and expanded to all economic zone in Cabuyao, Philippines. Foxconn’s workplaces: NXP claimed the union’s peaceful industrial actions were illegal. It was clear that the “It is vital that unions get together and take company’s persistent acts of intimidation action to achieve fair and decent working and harassment were aimed at weakening conditions in all the major electronics the bargaining power of the union. 3 companies.”

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Project session photos - We organize the workers! We fight against precarious work! After the active discussion, the Forum came to a consensus that: Employer and worker in the electronics industry should: 1 promote equitable treatment for all workers, regardless of their TEAM, Thailand EIWU and EIEU coalition in Malaysia employment status 2 raise awareness and build capacity on fundamental principles and rights at work-FPRW and promote respect of these principles and rights throughout the supply chains

FSPMI, Indonesia SBSI-Lomenik, Indonesia 3 jointly explore options in addition to temporary or other forms of employment to respond to fluctuating demands 4 promote long-lasting employment relationships, where possible VUIT, Vietnam ROCMU, Taiwan See more EICC, acting as the details at: employers’ group MWAP and IndustriALL immediately Collaborated activities with coordinator at the GDF, staged a global campaign to fight back. GUFs on MNC – IBM Alliance is comprised of more Actions included large pickets outside than 100 electronics negotiation venues and the NXP facility, Collaboration and cooperation with other companies, including national mobilizations, and corporate global unions is also a key activity in the the top five. Since the customer action focused on Apple. The sector. IndustriALL, together with UNI EICC describes itself as unified actions led to victory and brought a Global Union and IndustriAll European “committed to supporting fair and just solution. Not only were union Trade Union, make up The Global Union the rights and wellbeing of workers and members reinstated, MWAP also achieved Alliance of IBM. The alliance gives an communities worldwide affected by the a significant wage hike and regularization opportunity for IBM workers and unions global electronics supply chain”, IndustriALL of an important number of precarious to come together to discuss ways to will continue to engage in dialogue with the workers. protect workers and help ensure a better EICC to find fair and just solution for the future. Last year, the Alliance agreed on a issues on precarious work in the sector. Electronics industry challenged new global strategy to fight job cuts and over use of toxic chemicals demanded that IBM worldwide recognizes World Conference on ICT Electrical trade unions as partners in social dialogue IndustriALL is also teaming up with the and Electronics in June 2015 and collective agreements. After IBM GoodElectronics Network and its NGO In June this year, IndustriALL will hold a announced plans for massive lay offs, the partners to stop the use of cancer-causing World Conference on ICT Electrical and alliance strengthened its activities and chemicals in the electronics industry. Electronics in Malaysia. In addition to topics demanded an urgent moratorium on job on organizing and fighting precarious work, cuts and called for meaningful dialogue Trade unions and NGOs report hundreds the conference will focus on how to create with the troubled multinational. of cases of workers who have contracted a safer and healthier working environment, cancer and other illnesses over the past and on stronger trade union five years from exposure to benzene Global Dialogue Forum networks with Chinese workers at MNCs and other highly toxic chemicals used in In December 2014, there was a such as Samsung and Foxconn. electronics manufacturing. constructive discussion on precarious work in the electronics industry at the Global Jyrki Raina, general secretary of More than 200 civil society groups, IndustriALL, says: including IndustriALL and its electronics Dialogue Forum (GDF) on the Adaptability affiliates in Cambodia, Indonesia, Malaysia, of Companies to Deal with Fluctuating “Many electronics companies are purely Philippines, South Korea, and the US, Demands and the Incidence of Temporary in pursuit of profits and treat workers have launched a formal challenge to the and Other Forms of Employment, held at as a or a production cost. industry to clean up its act. The challenge the International Labour Office in Geneva. Brutal attempts to bust unions stink of emphasizes the importance of disclosure, The purpose of the Forum was for tripartite company arrogance. We must fight back substitution of hazardous chemicals with participants to assess the impact of by harnessing our global union power safer alternatives, protection of workers, temporary or other forms of employment just as we did in defeating the union- freedom of association, participation on electronics companies and workers. busting attack at NXP Philippines.” of workers in workplace monitoring, The Forum was attended by worker environmental protection, and the need for representatives (IndustriALL affiliated unions), governments, and employers, Good Electronics is an international network compensation of workers, communities on human rights and sustainability in and the environment for harm done. including the Electronic Industry Citizenship Coalition (EICC). The GoodElectronics electronics. network acted as an observer. @GoodElectronics 8