Summary of Key Points
Recently, Xingyu Co., Ltd., the leading company in the domestic automotive lighting industry, has been embroiled in a controversy regarding the mass dismissal of newly hired graduates for the class of 2024. During the previous recruitment season in autumn, Xingyu emphasized the benefits of the new energy vehicle market and the company's plans for capacity expansion, offering salaries higher than the industry average, and thus recruited over a thousand graduates. However, many of these graduates were asked to resign voluntarily on the grounds of "unqualified performance during the probationary period" or "temporary business adjustments," with the company refusing to pay the compensation stipulated in the tripartite agreements. This incident has not only sparked a collective effort by the graduates to protect their rights but also drawn attention to the common practice in the manufacturing sector of aggressively hiring during good times and laying off graduates during downturns.
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Detailed Analysis
1. Why target newly hired graduates? The cost-effective option for companies
Many people assume that companies are simply taking advantage of inexperienced graduates, but there is a clear financial calculation behind this decision. If a company were to lay off employees with three to five years of experience, it would have to pay significant compensation according to labor laws, and these employees often hold core skills and customer relationships, which could lead to labor disputes and the risk of leaking confidential information. In contrast, graduates, having only worked for half a month to a month, cost the company only half to a month's salary. Moreover, since they lack experience in defending their rights, they are less likely to cause trouble, making them the "most cost-effective" candidates for layoffs.
2. The so-called "industry benefits" that were touted during recruitment no longer apply
Xingyu didn't initially lie to the graduates. In 2022-2023, the sales of new energy vehicles surged, and smart-enabled headlights became standard equipment. Industry forecasts predicted a 20% increase in demand for headlights. Xingyu expanded its production capacity by opening several new factories, but the 2024 market saw a price war, with car manufacturers cutting prices significantly. As a result, the profit margin on headlights plummeted from 100 yuan to at most 20 yuan per unit. Many new car models eliminated smart headlights in favor of cheaper alternatives, leaving much of the newly built capacity idle. The company's initial plans for rapid growth were dashed.
3. A seemingly cost-saving move that actually results in a significant loss of reputation
Xingyu, once considered a reliable employer, has now lost its reputation. As the leader in the automotive lighting industry, it had built a reputation for stability and fairness towards graduates. This incident has caused all graduates to associate the company with unfair practices, making it difficult to attract top-tier talent in the future, even with higher salaries. Its customers, such as BYD and Tesla, rely on the stability of suppliers. If Xingyu cannot meet their demands, it could damage its long-term business relationships.
4. This is not an isolated issue; "hiring and then laying off" has become a common practice in many industries
Similar situations have occurred in recent years. During the semiconductor boom, chip companies hired thousands of graduates, only to lay off the newbies first when the market cooled. In the photovoltaic industry, many new energy factories hired trainees but dismissed them after just three months. This trend reflects a tendency among companies to over-hire during market booms and cut costs by laying off graduates during downturns, without considering their ability to absorb the extra workforce. This harms the entire job market, turning the job search into a gamble for graduates.
5. How can graduates protect themselves?
Graduates should be cautious when facing such situations. Make sure to read the tripartite agreements carefully and ensure they include clear penalties for breach of contract. If a company forces you to resign voluntarily without paying compensation, contact the labor authorities. Your rights during the probationary period are protected by law, and you are entitled to the full amount of compensation due, even if you have only worked for one day. Don't be intimidated by company HR and sign voluntary resignation agreements that may disadvantage you.