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Guards outside Wistron Corp.'s Bengaluru, India, manufacturing plant on Dec. 14.
Stringer/Reuters
  • Apple on Saturday reportedly put Wistron Corp, a manufacturing partner, on probation after workers at a plant in India caused rioted over reduced or unpaid salary.  
  • Apple and Wistron both acknowledged lapses in payment in October and November, according to The Times of India.
  • “We have place Wistron on probation and they will not receive any new business from Apple before they complete corrective actions,” Apple said in a statement, according to multiple local news reports. 
  • Visit Business Insider’s homepage for more stories.

Apple on Saturday reportedly said it would temporarily stop giving new business to Wistron Corp., putting its partner on probation after rioting workers at a plant in India caused about $7.1 million in damage.

The riots were over reduced or unpaid salaries.  

“We have placed Wistron on probation and they will not receive any new business from Apple before they complete corrective actions,” Apple said in a statement, according to multiple local news reports. 

Last weekend, about 2,000 workers coming off a night shift destroyed the lobby and other parts of Wistron’s iPhone facilities in Narasapura, India. Apple and Wistron both acknowledged lapses in payment in October and November, according to The Times of India. 

“While these investigations are ongoing, our preliminary findings indicate violations of our Supplier Code of Conduct by failing to implement proper working hour management processes. This led to payment delays for some workers in October and November,” an Apple statement said, according to The New Indian Express.

Wistron said it would remove its vice president in charge of India manufacturing, according to The Times of India.

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Apple's Wistron Corp. facility locked down behind bars in Narsapura, India, on Dec. 14.
Stringer/Reuters

Wistron and Apple didn't immediately respond to requests for comment. 

Last Saturday, images of workers smashing windows, spraying fire extinguishers, and flipping cars spread online.

The dispute in Narasapura, a suburb of Bengaluru, started as overnight workers left the Wistron factory early Saturday morning, according to The Times of India. Workers who had recently had their wages reduced - some by about a quarter - started discussing it on the factory floor overnight, the newspaper said.

Some reportedly only received tiny fractions of the pay that had been promised. By morning, the discussion had turned violent.

"They breached the four main entrance gates, ransacked offices, smashed lockers and desks, and destroyed documents containing details of employees," a police official told The Hindu on Sunday. 

About 128 people were arrested, while another 300 were detained for questioning, the official said. 

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Apple CEO Tim Cook testifies remotely via videoconference during a US House Judiciary Subcommittee in July.
US House Judiciary Subcommittee via Reuters

After last weekend's riots, Apple sent a team into Narasapura. 

"We have teams on the ground and have immediately launched a detailed investigation at Wistron's Narasapura facility," Apple said in an email to Nikkei Asia on Monday. 

On Tuesday, Wistron said damage at the facility totalled about $7.1 million, according to Reuters. 

Company and independent auditors have been "working around the clock" to investigate issues at the plant, the Times of India reported on Saturday. 

The Indian prime minister, Narendra Modi, was reportedly "very worried" about the ransacked factory. 

"We have taken action. It is a very important foreign company and this should not have happened. The PM is also very much worried about this development," BS Yediyurappa, chief minister of Karnataka, told India's Business Today. 

Wistron is just one of several foreign manufacturing companies that have chosen to open factories in the suburbs outside Bengaluru. Local politicians, including Yediyarappa, have pushed for it to become a global manufacturing hub. 

As Wistron scaled its operations in India this year, its HR practices failed to keep pace. 

"Though 10,500 workers are employed in the factory the HR department has not been adequately set up with personnel of sound knowledge of labour laws," said a government report, according to Reuters.

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