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Wistron incident: Karnataka govt finds labour law violations, pulls up company, contracting firms

The Karnataka labour department has found several law violations at iPhone manufacturer Wistron's Kolar facility and flagged them with the company and the labour contracting firms earlier this week.

The Karnataka government has found serious violation of labour laws at Wistron’s iPhone manufacturing facility in Kolar and has asked the Taiwanese company as well as the labour contracting firms it worked with to answer why they allowed the lapses.
According to sources, officials of the labour department in the state had called the management of Wistron and the labour contracting firms earlier in the week to flag the issues, and had asked them to respond by Friday.
It is not clear if the companies have sent their statements to the government even as some of the firms are likely to seek an extension.
The department has found that there were lapses in tracking attendance and overtime work at the facility. Many workers didn't have CLRA licenses, mandated under the Contract Labour Regulation Act, nor employment cards.
Many skilled and semi-skilled staff were being paid only minimum wages and did not get wage slips.
However, the department has said that they were not aware of any labour issues until the violence that broke out at the factory early on December 12, and said that they had not received a single complaint from any worker.
Even district officials in Kolar said they were not aware of labour issues at the Wistron plant, which has hired nearly 8,500 contract workers and 1,343 permanent employees in the past few months.
“The company was scaling up operations and workforce too fast, which is what could have led to the lapses,” a government official said.
Wistron did not respond to comments. CNBC-TV 18 reached out to Quess Corp, Addeco Group and Randstad, which are among the six contracting firms that worked with Wistron, for comments.
Addeco Group said: "We are working with all parties to investigate these allegations. We are committed to defending the rights of our associates to a fair compensation and employment benefits."
Quess Corp, in a statement, called the situation "very unfortunate". Randstad did not respond to queries.
It is to be seen what steps the Karnataka government takes against these firms based on their responses. Some reports suggest that the contracting firms could face fines and even blacklisting if found guilty of the violations.
Apple has also been carrying out its own investigation at the plant, where Wistron was mainly manufacturing iPhone SE and some older generation iPhones.