Summary of Key Points
Xingyu Co., Ltd., a leading company in the automotive lighting industry in the A-share market, recruited 440 fresh master's graduates from non-key universities during the autumn hiring season of 2025. Most of these graduates gave up other job offers and even had to pay termination fees. The company promised positions in research and development and technology. However, just one month after they started working in July 2026, HR began to meet with them in batches, offering them two options: either sign a resignation agreement citing "personal reasons" and receive half a month's salary or be transferred to a frontline position where they would assemble screws for a hourly wage of 20 yuan, working 11-12 hours a day, with their internship extended by three months. They were also threatened that their applications for background checks would be affected if they did not cooperate, and they only had half an hour to make a decision. In the end, about 70% of the students resigned voluntarily, and 107 were terminated. The Changzhou Human Resources and Social Security Bureau criticized the company for its harsh methods, and Xingyu apologized and offered compensation. But the reality is that the company was trying to reduce costs in preparation for its Hong Kong stock market IPO, treating the fresh graduates as "soft targets" that could be discarded at any time.
Detailed Analysis
Why Target Fresh Graduates?
The dismissal of fresh graduates is not accidental; it's a calculated move by the company:
- Lowest Cost: During the probationary period, dismissing employees only requires paying half a month's salary (older employees would require payment of N+1 months' salary, and any arbitration could make it a hot topic on social media). Since the company had just started contributing to their social security, the financial benefits were clear.
- Weak Bargaining Power: Fresh graduates have no experience, no union support, and are not irreplaceable, so HR can easily transfer them to other positions without resistance.
- Vulnerable Status: Once hired, fresh graduates are automatically enrolled in social security, which ends their status as fresh graduates. This limits their opportunities for government jobs or campus recruitment by state-owned enterprises, leaving them with no other options but to compromise.
In short, fresh graduates are seen as the "cleanest and cheapest" option for the company to use—retained when business is good and dismissed quickly when times are tough.
What Are the Company's Real motives?
The company's actions are aimed at improving its financial reports for the Hong Kong IPO:
- Reducing Labor Costs: Dismissing fresh graduates saves money, making the financial statements look more favorable to investors.
- Using Outsourcing: In 2025, Xingyu reduced its workforce by 2,900 people, but the hours and pay for outsourced workers increased by three times. Outsourcing eliminates the need to pay for social security, compensate employees, and assume legal responsibilities, making it more cost-effective.
- Avoiding Legal Risks: The termination of 107 employees should have been a "economic layoff" (requiring 30 days' notice), but the company handled it through individual interviews, forcing them to sign resignation agreements citing personal reasons and avoiding legal penalties.
How Did the Image of a "Best Employer" Crumble?
Xingyu won the title of "Best Employer in Changzhou" in January this year, promoting values like "love, gratitude, and responsibility." However, by August, it was forcing fresh graduates to do menial work. The contrast is stark:
- PR Stunts: Awards are often used as a marketing tool to attract candidates. Being named a "best employer" is not about genuine commitment to employees but about using the label to attract more applicants.
- Shifting Blame: The HR director was suspended after the incident, and the company tried to blame a single department, avoiding taking responsibility for the decision. Lawyers see this as a clear corporate action, not the work of one individual.
Who Loses in This Farce?
- Fresh Graduates: They lose their status as fresh graduates, miss out on valuable job opportunities, and suffer a significant loss of trust. Even with compensation, they cannot recover the time and opportunities they've lost, and they face tough competition in the job market.
- Companies: The company's reputation is damaged, making it harder to attract talent in the future and affecting its ESG (Environmental, Social, and Governance) ratings, as well as its Hong Kong IPO plans.
- Society: The treatment of fresh graduates undermines public trust in the industry, leading to skepticism about the entire hiring process.
Conclusion
Fresh graduates are not disposable assets; they are real people just out of school. We can accept layoffs, but not threats or the use of unfair tactics to control them. We can tolerate industry fluctuations, but not the exploitation of the most vulnerable groups. This incident should serve as a reminder to companies that mistreating fresh graduates ultimately harms them. It's also important for graduates to protect themselves by doing research before signing employment agreements and seeking help from labor authorities when faced with unfair treatment.