Nearly 70% of Foxconn’s Wisconsin employees started in fourth quarter of 2019

Crews install Foxconn signage on the 611 Building.

Last updated on April 10th, 2020 at 12:09 pm

Nearly 70% of the 580 employees working in Wisconsin for Foxconn and its subsidiaries at the end of 2019 started their current positions in the fourth quarter of last year, according to a BizTimes review of data the company submitted to state officials.

Foxconn’s contract with the Wisconsin Economic Development Corp. requires the company to submit an annual report to the agency on its hiring and investment activities. Documents submitted with the report provide details on wages, start date, residency state, which entity the employee works for and other information.

The company hasn’t commented on the report beyond a cover letter included in its submission. In it, Jay Lee, a Foxconn board member and vice chairman, touted the “strong foundation” the company had built for the Wisconsin project and said the company believes more than 550 employees met the criteria for job creation tax credits.

In total, the report lists 789 entries for employees who worked for Foxconn during the year. That data, however, includes employees that left before the end of 2019 along with internal transfers between entities and rehires.

Among the 580 entries without a termination date listed, 51 started in October, 100 started in November and 246 started in December. That group of 397 employees represents 68.4% of the total. It includes 30 transfers and six rehires. The report version released under Wisconsin’s open records law does not specify where the employees transferred from or when they previously worked with the company. Employee ID information was redacted from the public version.

Foxconn’s contract with the state made the company eligible for $2.85 billion in tax incentives over 15 years if it created 13,000 jobs and invested $10 billion.

The contract included yearly targets for the company to hit and Foxconn needed to have 520 qualifying jobs by the end of 2019 to earn any tax credits for job creation. In 2018, the company fell short of the 260-job threshold to earn state tax credits.

Foxconn’s new report says the company paid out $18.89 million in wages last year. The contract, however, does not allow Foxconn to receive credits on wages over $100,000. After counting only $100,000 in wages for the 30 employees that made more than the threshold, the company could potentially earn a 17% credit on nearly $16.86 million in wages.

While the company could receive $2.84 million in tax credits for job creation, it will likely be months before WEDC makes a final decision. The contract with the state requires a third-party auditor to review Foxconn’s report and then WEDC will need to complete its own review.

The two sides have also discussed the possibility of renegotiating the contract to align it with the evolving scale and goals of the project. Foxconn originally planned to build an LCD factory aimed at making large screens, but has since shifted to one designed for making a variety of screen sizes. Foxconn Industrial Internet, a separate, publicly-traded company that is not signed on to the contract, has also become involved in the development of the company’s Mount Pleasant campus.

Beyond the changes in the project, another area of concern with the project has been whether non-Wisconsin residents would take up jobs that could have gone to state residents. A 2018 Legislative Audit Bureau report suggested it would be possible for Foxconn to earn tax credits for work performed by employees outside of Wisconsin.

The new report submitted by Foxconn lists 36 employees outside of the state, including 10 that ended their employment before the end of 2019. The full group accounted for $1.23 million in wages paid out by the company, around 6.5% of the total. The company lists Wisconsin as the base of operations for all those employees.

Seventeen of the non-Wisconsin employees list an Illinois residence, the most of any state.

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Arthur covers banking and finance and the economy at BizTimes while also leading special projects as an associate editor. He also spent five years covering manufacturing at BizTimes. He previously was managing editor at The Waukesha Freeman. He is a graduate of Carroll University and did graduate coursework at Marquette. A native of southeastern Wisconsin, he is also a nationally certified gymnastics judge and enjoys golf on the weekends.

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