Beyond Trafficking and Slavery

‘Made in China’ vs. ‘made in the EU’: what’s the difference?

Foxconn’s operations in the Czech Republic and Turkey are similar to those so frequently criticised in China. Treating the latter as an exception obscures crucial dynamics of global capitalism.

Rutvica Andrijasevic
11 September 2015

Annette Bernhardt/Flickr. Creative Commons.

Foxconn, the world’s largest electronics contract manufacturer, is a Taiwanese-owned firm best known for being the main assembler of Apple products and for harsh working conditions at its Chinese factories. While Foxconn also operates in Europe, its factories in mainland China are by far the most severely scrutinised of all its operations. It is from there that we hear of militarised disciplinary regimes, excessive and unpaid overtime, unhealthy and unsafe working conditions and forced student labour related to Foxconn operations. Such a despotic management model prompted activists battling for workers’ rights in China to label Foxconn workers iSlaves.

Just how different is the situation in Europe? I set out to answer this question three years ago along with my colleague Devi Sacchetto from the University of Padua. We had a clear research agenda from the outset: to gain information about the composition of Foxconn’s workforce, its management practices, the organisation of production and reproduction, the role of the state, and the reach and impact of trade unions. We conducted 63 interviews in the Czech Republic and 29 in Turkey with current and former Foxconn workers and managers, trade union representatives, government officials and NGOs. Foxconn employs 9,000 workers across two factories in the Czech Republic and 350 in Turkey. Differences in scale notwithstanding, we found several transnational continuities.

A flexible and available workforce

Firstly, Foxconn’s production pivots on a flexible and available workforce. Foxconn in mainland China relies entirely on the use of rural migrants who are coming from all over the country. Foxconn houses its migrant workforce in collective dormitories within or close to its factories so as to compress the workplace and living space and facilitate just-in-time, high-speed production.

In the Czech Republic, the firm achieves flexibility by employing 40 percent of its workforce through temporary work agencies. These indirectly employed labourers—primarily EU migrants from Slovakia, Poland, Romania and Bulgaria—work 12-hour shifts during the peak production periods and are transported back to their countries of origin when work is scarce. They are hired on short-term contracts and are given notice of their shifts a week in advance at best, but often learn if they have work on the same day. Furthermore, they are paid €2-2.5 per hour compared to directly employed workers who are paid €3-3.5 per hour.

In Turkey, where all the workers are local workers and employed directly, Foxconn achieves flexibility by varying the working hours from 30 to 60 per week, depending on production needs. The shifts are between 10 and 12 hours—day or night, the same as in the Czech Republic—and workers receive details about their next shift by text message approximately 24 hours before they are to report for duty. Flexibility is also achieved by hiring Turkish Bulgarian women—so called Muhacir-Bulgarians—who have a more secular worldview and ‘modern’ lifestyle than locals, and are more willing to work the night shift.

Low labour costs

Secondly, in both countries, Foxconn’s strategy is to drive down labour costs. In the Czech Republic, in addition to cutting costs through temp agencies, savings are also found via the so-called ‘hour-bank system’. This system dictates that directly employed, usually male labourers must work a total of 930 hours in six months. They receive the same salary each month regardless of how many hours they worked above 930, yet end up ‘owing’ hours to Foxconn if they fail to meet the quota. There is furthermore no supplemental pay for working weekend shifts—all days are treated equally and are paid at the same flat rate.

In Turkey, Foxconn takes advantage of two government-run programmes to recruit workers as a means of driving down labour costs. The first provides internships for high school students, which are paid €100 a month for 3 days of work per week. The second, funded by the government through local employment centres, involves apprenticeships geared towards unemployed people. These are paid between €7.5 and €9.3 per day for eight hours of work. Current Turkish legislation also permits Foxconn to average out an individual’s working hours to 45 hours a week over a two-month period, allowing the firm to avoid paying overtime on a week-to-week basis.

State support

Thirdly, both sets of operations are supported by the state. Similar to Foxconn’s operations in mainland China, the placement of Foxconn’s plants in both Czech Republic and Turkey is facilitated by the state through significant fiscal incentives and provision of land and infrastructure. Due to the positive stance of its policies toward foreign investment, the Czech Republic was able to become a “computer hub for the Western European market”. In the Czech Republic, Foxconn enjoyed a 10-year tax holiday from 2000 until 2010 and is also exempt from the EU’s high tariff barriers, such as the 14 percent import duty on LCD TVs. These perks came as part of the Czech Republic’s larger strategy to attract foreign investment and become ‘a computer hub for the Western European market’.

In Turkey, Foxconn’s factory is located in the European Free Zone close to the city of Çorlu, about 100 km from Istanbul. Companies operating inside the zone are exempt from VAT and taxes on profit and wages as long as at least 85 percent of its produced goods are exported. Moreover, strikes within the free zone were banned for the first ten years of zone’s operations. That ban has now been lifted within the framework of EU negotiations.

Restricted trade unions

Finally, the influence of trade unions is extremely limited in both the Czech Republic and Turkey. Much has been written about China, where workers do not enjoy freedom of association, there is no right to strike, and unions are an integral part of factory management. The only legal representative of labour there, the All-China Federation of Trade Unions, is subordinate to the Communist Party and is an instrument of state control over workers.

The situation we encountered in the Czech Republic and Turkey in relation to trade union activities bears similarities to mainland China, in that the firm’s labour management is facilitated by the trade unions. In the Czech Republic, where trade unions are plant-based, the union tends to only be concerned with issues concerning directly employed workers, the majority of whom are Czech nationals. This de facto exclusion is done to protect the interests of the domestic workers, who benefit from the presence of temporary EU migrants because the latter group absorbs fluctuations in the demand for labour.

In Turkey, where unions are sector-based and operate in a stringent legal environment, unions have come increasingly under fire from their members for working against their interests. For example, the Turkish Metal Union—of which a number of workers at Foxconn are members—drew criticism during a recent round of collective bargaining in the automotive sector for its unwillingness to side with workers. This anti-labour stance by the TMU prompted a wave of strikes against the union and led to direct negotiations between workers and company representatives.

Are China and Europe so far apart?

As we can observe, there are striking similarities between Foxconn’s labour management practices in mainland China and Europe. While important for its mobilising function, the logo iSlaves counterproductively focuses the attention of scholars, activists, media and general public exclusively on China. This enhances the labelling of Chinese workers as ‘Others’, i.e. as passive and exploited victims of globalisation. This hides not only the fact that China is the “epicenter of global labor unrest”, but also the similarities in working conditions that Foxconn’s workers experience in both China and Europe. Importantly, such similarities show that while the responsibility for mistreatment of workers is with the firm, it is also with the states and the trade unions in that they enable and co-produce the conditions that permit workers’ exploitation.

Finally, placing two parts of the world, which are supposed to be divided and opposite in their managerial practices and treatment of the workforce, side by side offers new insights into the organisation of production in contemporary capitalism. First, we can observe changes to the gendered organisation of transnational production. While export-oriented manufacturing relied overwhelmingly on young women workers throughout the 1980s and 1990s, from the late 2000s onwards the factory workforce has been increasingly composed of both young men and women. Nowhere is this shift more visible than in the case of Foxconn’s plants in mainland China. Second, we note transformations to the organisation of the reproductive sphere. Foxconn houses its migrant workforce in the dormitories, which allows the firm to avail itself of a stationary workforce and facilitates the just-in-time model of production. Combining the spheres of production and reproduction through factory dormitories enables the extension of management’s control over labour and points to capital’s increased tendency to colonise the entire life of labouring subjects.

Our current findings suggest the need to challenge established models of thinking about economic globalisation. First, it is necessary to shift the centre of analysis from the US/Europe to the changes driven by the emergence of China. Second, we need to think of global production as inseparable and always already intertwined with social reproduction. Both of these considerations are pivotal if we are to capture and account for specificities of contemporary global capitalism.

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