Foxconn, China’s mega-manufacturing plant that supplies parts for Apple iPhones and Microsoft xboxes, is receiving more bad press for the alleged suicide pact that several of its employees were a part of this week.

Last year I wrote about a rise in workplace suicide at Foxconn, where 920,000 people live and work. In 2010, 11 employees had chosen death over working at electronics parts manufacturer, most of them jumping from the top of the highrise dormitories that house the workers. As the story goes:

This is not the first time the company’s worker conditions have come under scrutiny. In June 2006, the London Daily Mail published a story detailing the harsh conditions for the 30,000 employees at Foxconn’s Longhua iPod factory. Seeing a possible major reputation disaster looming, Apple dispatched several executives to investigate conditions at the plant. They issued a report detailing numerous violations of Apple’s supplier code of conduct.

Apple came under fire after these reports and reportedly made changes regarding the labor rules for the departments of Foxconn responsible for manufacturing Apple products. And now conditions at Foxconn are putting one of Apple’s biggest competitors in the spotlight.

Yesterday, dozens of Microsoft Xbox workers climed to the roof of one of the many dormitories on the Foxconn “campus” where they threatened to jump in a dispute over job transfers.

The dispute was set off after contract manufacturer Foxconn Technology Group announced it would close the assembly line for Microsoft Corp.’s Xbox 360 models at its plant in the central city of Wuhan and transfer the workers to other jobs, workers and Foxconn said Thursday.

Workers reached by telephone said Foxconn initially offered severance pay for those who wanted to leave rather than be transferred, but then reneged, angering the workers; Foxconn, in a statement, disputed that account, saying only transfers were offered, not severance.

Though Foxconn has apparently resolved the issues peacefully, 45 employees have resigned.

This is just another one for the infamous Foxconn record, a place that, for years, has received negative press for its harsh working conditions and low pay for employees. But as anyone in business knows, that negative press trickles down to its clients: Apple, Microsoft and Hewlett Packard. For these tech giants, its a reputational nightmare that will continue to make headlines unless more is done — and soon.