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| Foxconn signing. Photo by Graham Kilmer. |
In December Foxconn Vice Chairman Jay Lee told the Milwaukee Journal Sentinel that the company would have more than the required 520 employees hired to qualify for state tax credits. “The end of December we’ll have a number well beyond what we’re supposed to,” he told the newspaper.
That was a surprise to close observers of the company, who had seen few signs of much happening or many workers at the company’s Racine County campus. But nine days after Lee’s prediction, Foxconn Aerials, the Twitter account that takes overhead photos of the campus, tweeted a photo showing the parking lot for its little-used multi-purpose facility filled with cars. “Have never seen many cars at the multipurpose building since it was built more than a year ago. Until 12/21 when the lot was overflowing,” the Tweet noted.
Could the company be “trying to cram in 520 workers at the end of the year to get a 17% tax-funded kickback on those salaries,” as one observer tweeted in response to the photo. But that wouldn’t get the company much, because the contract awards the employment tax credits on a monthly basis for actual job hours worked.
“In order to earn the maximum amount of Capital Investment Tax Credits,” the contract states, the company must employ the specified number of full-time employees (520 by the end of 2019), but that may include “Partial Year Employees who are employed in Full-Time Jobs as of the end of the period” — by December 31. This same language is repeatedly used in three different paragraphs of the contract.
So the sudden addition of more workers in December at the Mount Pleasant campus would allow the company to collect the capital investment tax credits. And once they were awarded by the state, there is nothing to prevent Foxconn from laying those employees off and then repeating the same process at the end of 2020.
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