Foxconn still doesn’t get it! If you are going to increase the basic pay of your employees to 2,000 yuan a month, then just increase the basic wage – do not make it conditional on passing a three-month performance evaluation.
Basic pay is by definition “basic.” You should not have to perform really well to get a basic salary; you should get a bonus in addition to your basic wage if you perform well.
And why on Earth, when your company has just been hit by string of employee suicides, would you want to put the rest of the workforce under the added pressure of passing a performance review?
Foxconn has not announced details of its proposed performance review but it sounds very much like a second probation period. And if that is the case, it would be in contravention of Article 19 of the Labour Contract Law, which states: “An employer can only stipulate one probation period with a same worker.”
Moreover, new employees will reportedly be subject to a three-month prohibition period during which they will be paid 1,200 yuan a month, before being eligible for the 2,000 yuan salary. Again, the Labour Contract Law has specific provisions on the length of the probation period for new employees and the salaries to be paid to them. Article 20 states that:
This means that if Foxconn is offering a monthly wage of 2,000 yuan, then the wages of workers on probation should not be lower than 1,600 yuan per month.
And under Article 19, an employer can only specify a probation period of three months or more when the labour contract offered is in excess of three years. Is Foxconn offering new employees a three year contract?
Foxconn first announced a 20 percent pay rise on 29 May. When we pointed out that would be cancelled out by the Shenzhen’s government planned minimum wage increase on 1 July, Foxconn offered a 30 percent raise, which brought basic pay to 1,200 yuan a month, which while an improvement is still not enough to live on in Shenzhen.
Now the company is offering 2,000 yuan a month but only to those who meet its unspecified performance standards. If, as Foxconn founder and chairman Terry Guo says, the company is:
It should remove all the strings attached to this latest pay offer and just give its employees a decent basic wage.
Basic pay is by definition “basic.” You should not have to perform really well to get a basic salary; you should get a bonus in addition to your basic wage if you perform well.
And why on Earth, when your company has just been hit by string of employee suicides, would you want to put the rest of the workforce under the added pressure of passing a performance review?
Foxconn has not announced details of its proposed performance review but it sounds very much like a second probation period. And if that is the case, it would be in contravention of Article 19 of the Labour Contract Law, which states: “An employer can only stipulate one probation period with a same worker.”
Moreover, new employees will reportedly be subject to a three-month prohibition period during which they will be paid 1,200 yuan a month, before being eligible for the 2,000 yuan salary. Again, the Labour Contract Law has specific provisions on the length of the probation period for new employees and the salaries to be paid to them. Article 20 states that:
During the probation period, the salary of a worker shall not be lower than the minimum salary for the same post of the same employer or not lower than 80 percent of the wage as stipulated in the labor contract, nor may it be lower than the minimum wage of the locality where the entity is situated.
This means that if Foxconn is offering a monthly wage of 2,000 yuan, then the wages of workers on probation should not be lower than 1,600 yuan per month.
And under Article 19, an employer can only specify a probation period of three months or more when the labour contract offered is in excess of three years. Is Foxconn offering new employees a three year contract?
Foxconn first announced a 20 percent pay rise on 29 May. When we pointed out that would be cancelled out by the Shenzhen’s government planned minimum wage increase on 1 July, Foxconn offered a 30 percent raise, which brought basic pay to 1,200 yuan a month, which while an improvement is still not enough to live on in Shenzhen.
Now the company is offering 2,000 yuan a month but only to those who meet its unspecified performance standards. If, as Foxconn founder and chairman Terry Guo says, the company is:
Working diligently to ensure that our workplace standards and remuneration not only continue to meet the rapidly changing needs of our employees, but that they are best in class.
It should remove all the strings attached to this latest pay offer and just give its employees a decent basic wage.