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International and Comparative Employment Relations

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It is rather the labor practices related to the enforcement of labor laws which have been hampered to a great extent. This behavior of the countries can be directly seen as an attempt to attract higher Foreign Direct Investment (FDI). Similar findings were also made by Olney (2010) and he had observed that nations are engaged in a cutthroat competition with one another to reduce labor standards. For instance, the shifting of a vacuum cleaner plant of an American multinational company to Scotland had coincided with the relaxation of hiring standards in Britain. The case of Foxconn can also be treated as one which is blindly been driven by profit and neglecting labor standards.

Foxconn which mainly provides electronic parts to big players like Apple have greatly reduced their labor costs after the recession and it was evident in the rising operating margin of the company. Research conducted by Chan (2013) had shown that the company have compromised basic human rights in a bid to meet the production quotas. This has led to suicide attempts among multiple employees. The supply chain of manufacturing companies in China, in an attempt to harness export, led growth have created working conditions which were so mechanical that it almost became impossible for the workers to survive.

In another research of Chan, Pun, and Selden (2012) it was revealed that employees were so highly disgruntled with the conditions in the Foxconn factories that there was evidence of multiple protests against the harsh punishment that were met by the employees when they were late for their work. Problems were not only present with Foxconn, but all multinational companies operating in China, which had minimum regard for labor standards.

The problems do not lie solely with developing countries. Developed countries like the U. have also seen significant stagnation of real wages of workers engaged in the export-oriented industries as countries like China have very low minimum wages luring multinational companies to outsource their production processes in these countries (Becker, 2014).

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