A total of 155 former employees of the Research and Development Department of Siemens China in Beijing filed an arbitration claim with the local labour dispute arbitration committee at the end of April, seeking to secure unpaid year-end bonuses totalling 1.2 million yuan.
The problem for these employees arose in 2005 when German electronics giant Siemens sold off its global mobile phone business to Taiwanese-owned BenQ. With the change in ownership, Siemens China and its mobile telephone section in China terminated the employment contracts of 700 R&D staff. These staff members said they received the company's year-end bonuses for 2005 in January this year, but they discovered that the bonuses they got were 33 per cent less than the amount originally stated in their contracts.
According to Bo Yong, a lawyer with the Kangda Law Firm in Beijing who has been engaged by the group, all 155 former staff members of Siemens China were highly qualified professionals with undergraduate degrees or better and were professionals responsible for researching and developing new mobile phone models. The staff said they filed the arbitration "not for money but for fairness."
Wan Kan, a Siemens China employee, said the year-end bonus was an important component of their salaries, according to their employment contracts. Each staff would get as much as nearly 200,000 yuan as a year-end bonus if they achieved their work target.
"In 2003, the R&D team exceeded the original work target and each of us received a year-end bonus of 250 per cent [of the monthly salary]," another employee Shi Gang said. But in early 2005, Siemens China did not announce any working plans or targets for its research and development staff. The staff did not know about the company's plan to sell off the unit and they continued their work and developed more than a dozen of new mobile phone models, exceeding the targets of the previous two financial years.
However, in October 2005, Siemens sold off its global mobile phone business and more than 700 research and development staff of Siemens China were subsequently laid off. In December 2005, Siemens China did not give any year-end bonuses to the research and development staff, citing "financial difficulties". In January this year, the staff eventually received their year-end bonuses, but they were 33 per cent less than the amount stated in their contracts. The greatest individual discrepancy between the bonus received and that expected according to the terms of the employment contract was about 30,000 yuan.
Some staff were so angry that they went to the management of Siemens China to ask why their year-bonuses were cut. Siemens management replied, saying that "the company management decided that….[the research and development team] had only completed 67 percent of it work target for 2005". The employees responded saying that the company did not announce a work target at the beginning of the financial year of 2005 and it should be the company's responsibility to meet its unannounced work target. They argued that the company should not use it as an excuse to deduct their year-end bonuses. To get back the additional portion of their year-ended bonuses, 155 former research and development staff of Siemens China have recently filed an application for labour arbitration, and are seeking to recover a total of about 1.2 million yuan in unpaid year-end bonuses and 800,000 yuan in economic compensation.
Bo Yong, the lawyer for the former Siemen staff, said according to labour laws and regulations in China, the unpaid year-end bonus in this case should be interpreted as unpaid wages. Under normal circumstances, the employer should give the employees a clear work target. The fact that there was no clear work target for the unit for that year was the responsibility of the employer, not the employees, "In this case, Siemens China, as the employer, did not announce a clear work target, and therefore the company should bear the responsibility," Bo said.
Note: The names of the Siemens China employees appeared in this articles are pseudonyms.
Source: Beijing Morning Post (1 May 2006)
4 May 2006
The problem for these employees arose in 2005 when German electronics giant Siemens sold off its global mobile phone business to Taiwanese-owned BenQ. With the change in ownership, Siemens China and its mobile telephone section in China terminated the employment contracts of 700 R&D staff. These staff members said they received the company's year-end bonuses for 2005 in January this year, but they discovered that the bonuses they got were 33 per cent less than the amount originally stated in their contracts.
According to Bo Yong, a lawyer with the Kangda Law Firm in Beijing who has been engaged by the group, all 155 former staff members of Siemens China were highly qualified professionals with undergraduate degrees or better and were professionals responsible for researching and developing new mobile phone models. The staff said they filed the arbitration "not for money but for fairness."
Wan Kan, a Siemens China employee, said the year-end bonus was an important component of their salaries, according to their employment contracts. Each staff would get as much as nearly 200,000 yuan as a year-end bonus if they achieved their work target.
"In 2003, the R&D team exceeded the original work target and each of us received a year-end bonus of 250 per cent [of the monthly salary]," another employee Shi Gang said. But in early 2005, Siemens China did not announce any working plans or targets for its research and development staff. The staff did not know about the company's plan to sell off the unit and they continued their work and developed more than a dozen of new mobile phone models, exceeding the targets of the previous two financial years.
However, in October 2005, Siemens sold off its global mobile phone business and more than 700 research and development staff of Siemens China were subsequently laid off. In December 2005, Siemens China did not give any year-end bonuses to the research and development staff, citing "financial difficulties". In January this year, the staff eventually received their year-end bonuses, but they were 33 per cent less than the amount stated in their contracts. The greatest individual discrepancy between the bonus received and that expected according to the terms of the employment contract was about 30,000 yuan.
Some staff were so angry that they went to the management of Siemens China to ask why their year-bonuses were cut. Siemens management replied, saying that "the company management decided that….[the research and development team] had only completed 67 percent of it work target for 2005". The employees responded saying that the company did not announce a work target at the beginning of the financial year of 2005 and it should be the company's responsibility to meet its unannounced work target. They argued that the company should not use it as an excuse to deduct their year-end bonuses. To get back the additional portion of their year-ended bonuses, 155 former research and development staff of Siemens China have recently filed an application for labour arbitration, and are seeking to recover a total of about 1.2 million yuan in unpaid year-end bonuses and 800,000 yuan in economic compensation.
Bo Yong, the lawyer for the former Siemen staff, said according to labour laws and regulations in China, the unpaid year-end bonus in this case should be interpreted as unpaid wages. Under normal circumstances, the employer should give the employees a clear work target. The fact that there was no clear work target for the unit for that year was the responsibility of the employer, not the employees, "In this case, Siemens China, as the employer, did not announce a clear work target, and therefore the company should bear the responsibility," Bo said.
Note: The names of the Siemens China employees appeared in this articles are pseudonyms.
Source: Beijing Morning Post (1 May 2006)
4 May 2006
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