Summary of Key Points
Recently, SF Express has adjusted the salary structure for its headquarters staff, converting 15% of the fixed monthly salary into quarterly performance-based payments, which has raised concerns among employees about what they perceive as a disguised salary cut (they believe it's like putting three months' worth of salary at risk, as lower performance will result in less payment). The company claims this is part of an effort to improve the incentive mechanism, with higher earnings for high-performing employees, and it does not affect frontline workers. At the same time, SF Express is facing challenges such as slowing growth and high labor costs, and is seeking new growth opportunities by controlling costs (by adjusting the salaries of headquarters staff) and through internationalization (by holding shares in Jet Express).
Employees are upset because they were not consulted in advance and worry about further financial losses. Some have begun preparing for labor arbitration, and SF Express' subsidiary, Fengchao, has already discontinued the similar policy.
I. Salary Adjustment: Employees See It as a Cut, Companies See It as Incentive
The employees' main complaint is that a portion of their monthly salary, which was previously fixed, is now dependent on quarterly performance reviews. For example, if an employee's monthly salary is 10,000 yuan, they used to receive the full amount, but now they only get 8,500 yuan, with the remaining 1,500 yuan depending on the quarterly performance review. If the review is poor (rated B3 or C), they might not receive the full 1,500 yuan; even if the rating is average (B1-B3), they only get back the original 15% of that amount, meaning the money is delayed by three months.
The company views this as an incentive: more than 10% of high-performing employees (rated A or B1+) will receive a higher salary after the adjustment (with coefficients of 1.1 or 1.05). However, employees disagree, arguing that the number of high-performing positions is limited, and the sudden notification without consultation makes them feel pressured to accept the change.
Legal experts point out that unless the change is agreed upon with the employees in advance, it can be considered a disguised salary cut. If employees file for arbitration on the grounds of being forced to accept the change, they are likely to receive compensation, as the company has not demonstrated that the employees agreed to it voluntarily.
II. Why SF Express Is Adjusting Salaries at the Headquarters Level?
SF Express is under pressure due to declining performance and high labor costs:
- High Labor Costs: In 2025, labor costs amounted to 129.78 billion yuan, accounting for 43% of total revenue (43% of every 100 yuan earned went to wages), and these costs increased by 15.75% year-over-year.
- Slowing Growth: Revenue growth in the first half of 2026 was only 5.9%, 3.37 percentage points slower than the same period in 2025. The revenue per delivery has also decreased from 23 yuan in 2018 to 14 yuan, a 40% reduction. Although there has been a slight improvement in 2026, profit margins are still under pressure.
The reason for focusing on headquarters staff salaries is that frontline employees (couriers and sorters) are crucial for service quality, and adjusting their salaries could affect delivery quality. In contrast, headquarters staff are more easily affected by cost-control measures.
III. Employee Resistance: Negotiations and Arbitration Plans
Employees are reacting strongly:
- Lack of Consultation: They feel disrespected because they were simply notified to accept or reject the change without prior discussion.
- Discussions as a Form of Confrontation: Employees who disagree are met with leaders and HR, but the discussions are more for clarification rather than changing the decision.
- Arbitration Preparation: Some employees plan to keep evidence of reduced salaries to file for arbitration, fearing that future performance ratings could be changed at will.
Interestingly, SF Express' subsidiary, Fengchao, has already stopped implementing the quarterly performance-based payment policy due to employee opposition, indicating that employee resistance can be effective.
IV. SF Express' Efforts to Survive: Cooperation with Jet Express and Internationalization
The domestic courier market is saturated, so SF Express needs to seek new growth:
- Joint Investment: SF Express has acquired a 10% stake in Jet Express, and Jet Express has a 4.29% stake in SF Express. Wang Wei also serves as a non-executive director for Jet Express.
- Synergy: Internationally, SF Express aims to expand into cross-border services, leveraging Jet Express' strengths in Southeast Asia and the Middle East. Domestically, Jet Express needs SF Express' assistance with last-mile delivery services (such as time-sensitive deliveries and Fengchao's locker services).
In short, SF Express is using Jet Express to enter international markets, while Jet Express uses SF Express to improve its domestic services, working together to generate additional revenue.
V. The Essence of the Dispute: A Battle Between Cost Reduction and Employee Rights
SF Express believes it needs to control costs to survive, while employees want to ensure their salaries are not reduced or the rules are changed unilaterally.
For employees, if the company had consulted them, it would show respect; a sudden change without consultation feels like a tyrannical decision. For SF Express, labor costs are a major expense, and not controlling them could lead to even worse profits. Using the guise of incentives to cover cost cuts can damage trust.
The possible outcome is that some employees will receive compensation through arbitration and leave the company, while SF Express will continue with the policy, possibly making adjustments (such as increasing the number of high-performing positions). Fengchao's decision to stop the policy also serves as a reminder that employee concerns cannot be ignored.
In summary, this salary adjustment is a last resort for SF Express under performance pressure, but the lack of transparency in the process has led to employee backlash. Whether SF Express can find new growth through internationalization will determine whether it can continue to make changes that affect employees' interests. For employees, it's important to keep records (such as pay slips and notifications) and consider arbitration if necessary to avoid unfair treatment.