Bloomberg was invited for an exclusive first-time look inside Pegatron’s Shanghai, China iPhone assembly plant, and the publication posted their report on Sunday. Pegatron has in recent years taken on more and more of the iPhone assembly duties as Apple looks to diversify their supply chain.
The report describes how Pegatron manages its factory workforce, using modern technology to streamline tracking of worker’s hours and overtime, as well as helping it to plug leaks of unreleased products to the media.
The men and women stare into face scanners and swipe badges at security turnstiles to clock in. The strict ID checks are there to make sure they don’t work excessive overtime. The process takes less than two seconds.
After passing through metal detectors to sniff out camera-equipped devices that could be used to leak pictures of unreleased new products, the workers follow arrows on the floor and inspirational posters on the wall.
Workers then climb a stairwell that includes a safety netting draped across its middle to prevent injuries from accidents, and yes, suicide attempts. They enter the locker room, where they don blue hairnets and swap out their shoes for plastic slip-on slippers. At 9:20 AM, the 320 worker shift lines up in four rows for roll call. Their shift on the production line begins six minutes later.
The automated check-in allows the company to track a worker’s hours, making sure they do not work excessive overtime hours. (An October report by an external watchdog group showed the majority of Pegatron’s workforce worked in excess of 60 hours per week.)
The ID badges employees wear connect to a central database that tracks wages, time worked, lunch expenses, and more. Employees are allowed to access the payroll database to track their own hours, income, and expenses.
John Sheu, known at the factory as Big John, or the Mayor, is president of the Pegatron facility, where as many as 50,000 employees assemble the iPhone. He tells Bloomberg employees are eager to track their income.
“What do workers care about the most? They want to know about the money they earned,” Sheu said. Deciding to open up payroll was difficult, Big John said, because of how employees might react, and how it would push management to be more accountable.
Including overtime pay, employees take home an average of 4,200 yuan to 5,500 yuan ($650-$850) a month. An employee, who helped workers access the automated information stations, showed her base salary was 2,020 yuan. An iPhone 6 in China costs 4,488 yuan.
Employees are predictably less than thrilled with Pegatron’s new emphasis on controlling overtime. A worker interviewed by Bloomberg said employees want to work more overtime, due to the low wages paid by the plant. The new enforcement policies make it very difficult for employees to grab extra hours to make much-needed additional income.
While Chinese factories are finding it harder to find and retain workers as the labor force in the country continues to shrink, retention rates at Pegatron’s Shanghai factory have increased 20% over the last three years. Last year, turnover at the plant averaged around 16%.
For more detailed information about the Pegatron plant, read Bloomberg’s full report here.