China Labour E-Bulletin Issue No. 20 (2004-11-19)

In this Issue:

1. Editor's Note


Editor's Note

Dire Safety Record of U.S. Semiconductor Manufacturer, AXT, Prompts Major Concern about Health Situation of Hundreds of Workers at its New Beijing Factory

19 November 2004

In the summer of 2004, Beijing Tong Mei Xtal Technology Co., Ltd (AXT-TM), a US-invested semiconductor manufacturing facility located in the Tongzhou district of Beijing, attracted Chinese media attention and also scrutiny from overseas labour organisations because of the potential hazards posed by its factory environment to the health of its workforce of more than 660 and their families.

On 10 July 2004, China Labour Bulletin received a letter from the Health Care Workers Union in San Francisco alerting us to its concerns about AXT’s occupational health and safety regime at its recently established factory in Beijing. In subsequent contacts, the union provided CLB with detailed information about the serious occupational health and safety problems that had already afflicted the workforce at AXT’s semiconductor production facility in eastern California, located about 30 miles from San Francisco. According to the findings of a survey conducted by a coalition of labour rights and environmental groups (and subsequently confirmed by the California Department of Industrial Relations), several hundred Chinese migrant workers at AXT’s factory – 90 percent of whom could not speak English – had for years been exposed to carcinogenic levels in the workplace more than four times the legally permissible limit. In one worker’s case, according to the survey report published by the Asian Pacific Environmental Network, the carcinogenic levels at the factory had been more than 21 times the legal limit. On 17 May 2000, the California Department of Industrial Relations’ Division of Occupational Safety and Health (DOSH) imposed on AXT fines and penalties totaling US$313,655 for failing to take necessary preventive measures to protect its employees from dangerous exposure to gallium arsenide, a cancer-causing agent, and a range of other toxic elements. In all, DOSH cited AXT for no fewer than 42 violations of the State of California’s workplace health and safety regulations.

Formerly known as American Xtal Corp. and located in Fremont, California, AXT manufactures semiconductor substrates using gallium arsenide, a technically advanced industry replacement for silicon. Touted by the business community as a model corporation, in 2001 the company was listed in Forbes magazine as being among the top 200 small businesses. According to the Asian Pacific Environmental Network’s report, AXT has done business with the US National Aeronautics and Space Administration, and the US Department of Defense has invested almost $1.5 million in AXT research projects. The company’s customers have included such major international firms as Hewlett-Packard, Motorola, Nortel Networks, and TRW Space.

After learning about AXT’s appalling health and safety record in California, on 12 August 2004 China Labour Bulletin sent a letter to some twenty different PRC government departments, including the Health Ministry, the Ministry of Labour and Social Security, the State Administration for Work Safety and the All-China Federation of Trade Unions (ACFTU), expressing our deep concern about the environmental working conditions and workers’ overall health situation at AXT’s new production facility in Beijing. To date, none of these various government departments or offices has responded to our letter. China Labour Bulletin is now deeply concerned about the health and safety of the AXT workers in Beijing, and we are therefore releasing this statement (in both Chinese and English versions) to draw the attention of the Chinese government, the ACFTU, the domestic Chinese news media and the international press to the urgent need for effective independent monitoring of the working environment at AXT’s Beijing factory and for effective measures to be taken to protect the health of its workers and their families.


According to an 8 August 2004 report in the Hong Kong newspaper Wen Wei Po (a Chinese government-backed news source), AXT - a semiconductor manufacturer in East Bay, San Francisco, California - had gradually relocated its production facilities from the United States to Beijing over the previous three years after being frequently fined by the California Department of Industrial Relations' Division of Occupational Safety and Health (DOSH) for using toxic elements in production, including gallium arsenide, thereby posing serious health risks to the company's mainly Chinese immigrant workforce in California.

According to Wen Wei Po, "American Xtal's operational training supervisor stationed in Beijing sent by the US factory failed to inform the workers in Beijing about either the carcinogenic health risks posed by gallium arsenide or the fact that it can cause birth defects in infants." The former supervisor himself, a Mr. Zheng, admitted to the newspaper: "We didn't tell them that gallium arsenide is toxic, so they didn't know that it was, or rather we had no idea whether or not they knew it was toxic. So they themselves never specifically brought up this issue. However, their mental and psychological condition was below par as compared to other young people." A Vice Consul at the PRC Consulate General in San Francisco, Wu Jian, informed Wen Wei Po that he would investigate AXT's relocation of its factory to Beijing and consult with his superiors as to what action should be taken on the matter.

Susan Gard, a spokeswoman for the California Department of Industrial Relations, was quoted as saying that if AXT did not change and improve its mode of operation, the workers at the company's new factory [in Beijing] would face the same contaminated working environment as that experienced by workers at its factory in California - especially since "the regulations there are probably less strict than the ones here, and there are probably fewer inspectors available to check up on the factory."

The California Government’s Investigation of AXT

Documents obtained by the DOSH during their investigation and on-site monitoring of AXT’s California factory in February 2000 showed that the workers there were exposed to arsenic levels of more than four times the legally permissible limit – and moreover that AXT had known about the toxic exposure hazard to the workers since July 1998.

  • On 10 February 2000, DOSH obtained documents from AXT indicating that from July 1998 onward the company itself had measured levels of employee exposure to arsenic that exceeded the DOSH-permitted limit, in some cases by as much as four times and in one case by over 21 times.

  • On 14 February 2000, a DOSH inspection team visited the AXT production facility with a Chinese translator and accompanied by the head of the Occupational Health Branch of the California Department of Health Services. The team found that most workers there were Asian migrants and that around 90 percent of them did not speak English. DOSH also took wipe samples for arsenic particulate in the various work areas. The subsequent analysis results identified widespread arsenic contamination of the desks, benches and other work areas in the factory.

  • On 16 February 2000, DOSH mobilized its Oakland District Office to conduct full-shift sampling of two separate shifts (6 AM – 12 PM) of workers in three departments of the AXT factory. Inspectors from the High Hazard Unit conducted a complete survey of the laboratory hoods in the three departments. On 22 February 2000, the results of the safety inspection revealed continued high levels of employee overexposure to airborne inorganic arsenic, including exposure at four times the legal limit. DOSH then issued an “Order to Prohibit Use” (OPU), shutting down the three factory departments concerned.

  • On 26 February 2000, DOSH lifted the OPU and permitted the resumption of limited production in the three affected departments, after AXT management had carried out four days of intensive remedial and corrective measures. The following month, after reviewing AXT’s replacement of contaminated ventilation systems and the company’s findings that toxicity levels had fallen to legally acceptable limits in two of the three departments, DOSH allowed the latter to resume normal production. The third department maintained a “regulated area” until June, when employee contaminant-exposure levels were found also to be within regulatory limits.

  • On 5 April 2000, the Oakland District Office proposed to DOSH Headquarters the issuance of “Willful” citations against AXT for failing to take action over an 18-month period to reduce its employees’ exposure to airborne arsenic and to provide proper protection for all affected employees. On 17 May 2000, DOSH issued 42 citations against AXT, including 24 General citations, 4 Regulatory citations, 11 Serious citations, 1 Willful General and 2 Willful Serious citations. The complete list of citations carried monetary penalties totalling US$313,655.

  • On 5 June 2000, AXT’s attorneys filed an appeal against all the citations and penalties. On 1 February 2001, DOSH recalculated and reduced the total penalties to US$198,655, and AXT then agreed to withdraw its appeal. On 6 March 2001, The Occupational Safety and Health Appeals Board in Sacramento, California, issued a final order closing the AXT appeal case.

    In 2002, AXT began laying off than 500 workers and gradually moved its entire production facility to mainland China. In July 2004, the company’s production headquarters in Fremont, California, was closed down.

    What is Gallium Arsenide and How is it Harmful to Health?

    Gallium arsenide is a highly effective substance for use in the production of advanced high-speed semiconductors and it is widely employed in the optical electronics and microelectronics industries. However, arsenic, one of the constituent elements of gallium arsenide, is extremely toxic in nature. Exposure to it can result in major harm to the cardiac blood vessels, nerve system, immune system, haematopoietic system and reproductive system, and can also cause lung cancer, skin cancer, bladder cancer, liver cancer, kidney cancer, prostrate cancer and nasal cancer. Even minor or incidental contact with the substance can produce severe inflammation of the skin.

    A British government-led investigation of 2001 into cancer rates among workers at a factory in Scotland owned by US National Semiconductor, and which examined the factory’s entire staff rather than just the 25 percent who actually worked with chemicals, found “a statistically significant rise in cancer rate” among the staff. According to a clinical professor at U.C. San Francisco, the results of this study “suggest that the increase in the rate of cancer may be greater than the rate of increase in spontaneous abortion.” Under normal circumstances, he added: “For young people, the spontaneous abortion rate is much higher than cancer. These are young, unskilled women who shouldn’t have a high cancer rate at all.” (Environmental Magazine, 24 May 2002.)

    The health risks of exposure to gallium arsenide were also demonstrated by an eight-week research study into the substance’s effects on the reproductive system of rats. According to the study, twice-weekly exposure to gallium arsenide resulted in a substantial fall in the animals’ sperm counts, together with an increase in abnormal sperm levels. (See: “Possible Health Hazards Associated with the Use of Toxic Metals in Semiconductor Industries,” Journal of Occupational Health, 2000; 42: 105-110.)

    In its now defunct California factory, AXT used gallium arsenide as its main raw material for producing semiconductors, and according to DOSH inspectors the factory’s production methods resulted in levels of toxic arsenide dust and fumes in the workshop environment that were four times the legally permitted maximum. According to information compiled by the Health Care Workers Union in San Francisco, moreover, the raw materials used in AXT’s production line also contained numerous other toxic chemicals – including indium phosphide, sulphuric acid, ammonium hydroxide, hydrogen peroxide, ethanol, hydrogen fluoride, perchlorothene, bromine, hydrochloric acid, zinc, sulphur, nitric acid, sodium hypochloride, iodine, and methanol. Some of these chemicals are specifically categorized as “toxic” by the PRC Ministry of Health – for example, hydrogen peroxide, hydrogen fluoride, hydrochloric acid, iodine and methanol; others, including bromine, are categorized as “highly toxic.”

    In a previous similar case, on 10 November 2003 the mainland Chinese newspaper Economic Information Daily reported that 257 former employees of an IBM factory in the U.S. had accused the computer giant of concealing the existence of toxic chemicals, including gallium arsenide, in the workplace. The workers asserted that this had resulted in an increased incidence of cancer among the workforce.

    If workers anywhere are exposed, over protracted periods and without the necessary protective equipment having been installed, to factory environments containing high levels of toxic contaminants such as arsenide and the other chemical substances listed above, then the workers’ own health, their families’ health, and that of their future offspring will inevitably be placed in severe jeopardy.

    Results of the Field-Survey of Former AXT Factory Workers in California

    In May 2004, more than 150 former AXT workers met in Oakland’s Chinatown to discuss their health concerns and their mistreatment by the company, and to seek health screening and education services for themselves, other former AXT employees, and any family members who may have been exposed to arsenic. A consortium of support organizations, including the Asian Pacific Environmental Network, the University of California San Francisco Community Occupational Health Project, Asian Health Services, the Asian Law Caucus, and the University of California Berkeley Labor Occupational Health Project, then conducted medical evaluations of 133 former workers from AXT’sFremont, California factory and provided them with medical information about the current and future health risks they faced. The results of the survey, published by the Asian Pacific Environmental Network, were as follows:

    Gender Male66
    Gender not Recorded1
    Average age51 years old
    Average no. of years at AXT3 years

    Worker Survey Overview

    YesNoDon't know
    Had children or pregnant women living at home while working for AXT:7534(24: no response)
    Worked in areas where gallium arsenide was used:94726 (6: no response)
    Worked in areas where indium phosphide was used:711837 (7: no response)

    In addition, 111 workers observed the following occupational health and safety hazards while working at AXT:

    Poor ventilation91
    Air was filled with dust from the semiconductor chips46
    Ventilation fans/hoods sometimes did not work27
    Handled chemicals27
    Experienced difficulty breathing (coughing, gagging, etc)66
    Felt dizzy at work66
    Eyes were red or irritated after work66
    Had problems with their vision after work60
    Skin was red or irritated after work46
  • Only 3 percent of the workers said they were informed by AXT that the chemicals they were exposed to at work could cause cancer or birth defects
  • Only 10 percent of the workers reported having received any training on how to minimize their exposure to gallium arsenide
  • (Source: Asian Pacific Environmental Network: “AXT Workers Survey Report,” 24 May 2004.)

    According to the workers interviewed, AXT had resorted to a number of subterfuges to avoid outside detection of these health and safety problems. For example, it reportedly maintained two drainage systems, one of which complied with official health standards and was shown to the California health and safety inspectors, while the other system was used to dispose of toxic industrial wastes.

    Highlights of China Labour Bulletin’s Letter to the Chinese Authorities

    In a letter sent to various PRC government departments and the ACFTU on 12 August 2004, China Labour Bulletin outlined our concerns about the potential threat to the health and safety of Chinese workers and their families at AXT’s new factory in Beijing after the company relocated its production base there and closed down its California factory. Based on the available information, we indicated that there were clear grounds for suspecting, at least, that one of the possible reasons why AXT relocated its production base to Beijing was to avoid any further monitoring and inspection by the California Department of Industrial Relations’ Division of Occupational Safety and Health.

    China Labour Bulletin also raised the following questions: Would the Beijing Tong Mei Xtal Technology Co., Ltd (AXT-TM) serve as a replica version of the company’s original production methods and facilities in the United States? Would the company resort to similar subterfuges as those reportedly adopted by its former US production base, in an effort to circumvent monitoring by China’s occupational health and safety departments? Would Tongmei Xtal’s mainland Chinese workers encounter the same kinds of problems and hazards as those experienced by workers at the AXT’s former factory in the U.S.? (Are they working for long periods of time in a poorly ventilated working environment? Have they been provided with necessary and effective protective equipment? Have they been given any occupational safety training on how to work with toxic substances?)

    Based on these concerns, China Labour Bulletin called upon the Chinese government departments concerned and the official trade union to promptly adopt the following measures in order to forestall any unfortunate or hazardous developments at the factory:

    1. Require that AXT-TM provide regular physical health check-ups for all workers exposed to gallium arsenide and other chemical substances. This regular health monitoring should focus on how exposure to toxic chemicals may have affected the workers’ health.
    2. In accordance with the PRC State Council’s 12 May 2002 Labour Protection Regulations for Workplaces Using Toxic Substances, to arrange as soon as possible for the relevant government departments and trade union to undertake a comprehensive investigation of the production environment and working conditions at AXT-TM, with a view to eliminating any concealed or potential hazards to health and safety in the workplace. Particular attention should be paid to the factory’s ventilation equipment and automatic alarm installations, and also the ventilation facilities for dealing with emergency situations.
    3. Ascertain whether or not the company is employing any workers under 18 years of age, or any female workers who are either pregnant or breast-feeding, to handle or work with toxic substances.
    4. Ascertain whether or not the company is providing workers who are exposed to toxic substances in the workplace with protective equipment that meets and complies with PRC Health and Safety Standards.
    5. Ascertain if the company has accurately informed workers who are exposed to toxic substances during their work about the potential harm and consequences of exposure to these substances; whether it has informed them of the protective and preventive measures that must be taken, and of the company’s terms of compensation in the event of occupational illness; and whether or not these measures, conditions and terms are written into their labour contracts.
    6. Ascertain whether the company provides any pre-work training and on-the-job training on occupational health and safety for the workers, and if it has given the workers proper instructions on how to use correctly the factory’s protective equipment and the personal protective gear.
    7. Ascertain whether or not the company’s other measures and equipment for protecting occupational health and safety are in conformity with the relevant provisions of the State Council’s Labour Protection Regulations for Workplaces Using Toxic Substances.

    In China Labour Bulletin’s view, an enterprise-level trade union that can genuinely represent the workers’ rights and interests, and whose leaders are elected by the workers themselves, should immediately be established at the Beijing Tong Mei Xtal Technology Co. Ltd.The elected trade union should set up an Occupational Health and Safety Supervisory Committee, which should then participate fully in all aspects of the above-listed investigation process and be responsible for publicly informing the workers of the results of the investigation.

    Over the past few years, the All-China Federation of Trade Unions has been calling for the establishment of trade unions in foreign-invested companies, for the workers themselves to elect the trade union chairperson and other union office holders, and for these trade unions to participate in monitoring health and safety conditions in the workplace. It is time for the ACFTU to begin carrying out and upholding this policy commitment.

    China Labour Bulletin calls upon the Chinese government to give full and equal attention, when implementing its policy of attracting foreign capital to develop the economy and promote employment, to the vital task of ensuring that all necessary safeguards for the health and lives of the workers are always provided. In addition, we urge China’s domestic news media and the international press to pay close attention to the potential occupational health and safety hazards facing the workers at Beijing Tong Mei Xtal Technology Co. Ltd.

    For further information:
    Tel: 852-2780 2187
    Fax: 852-2359 4324

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