Foxconn – the sad culture of ‘condolence payments’

Some stories really stick in your mind – like the one I read some years ago which described how young Chinese students who had achieved lower grades than expected in their college examinations, were committing suicide rather than live with the shame of their perceived under achievement.

But this week, a story appeared with little fanfare about employees working at the Taiwanese subsidiary office of Foxconn Electronics Inc manufacturers of hardware for Apple, Nokia, Dell and Sony.  It seems the company has amended its personnel policies to reduce the amount of ‘condolence payments’ made to families of employees who ended their own lives.  It seems that the law in the city of Shenzhen in the Guangdong province in South China, stipulates a minimum payments of a hundred thousand yuan – around ten thousand pounds – to bereaved families.  It seems that Foxconn were paying up to thirty times this amount – one suspects in an effort to attract the best staff.

But its policy clearly had an effect on some employees, as nearly a dozen committed suicide this year alone in order that their families should receive a large cash sum.

The firm has now reduced the amount of condolence payouts to the level stipulated by local statute, and raised the monthly salary paid to workers on its contruction line.  But doesn’t it make you wonder what induces a commercial business to include such ‘condolence payments’ in their employment contracts in the first place?

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