HONG KONG • JD.com Inc is preparing deep cuts to its workforce and rescinding some job offers as the Chinese e-commerce giant struggles to revive dwindling morale and rein in losses, people familiar with the matter said.
Alibaba Group Holding Ltd’s closest rival told managers that it’s looking to reduce headcount across the company, cutting some teams by as much as half, one of the people said, citing an internal email.
JD is reneging on some work contracts and offering impacted college graduates token compensation of 5,000 yuan (RM3,050), the people said, asking not to be identified discussing a private matter. The Information earlier reported that, all told, JD could be slashing its workforce by as much as 8%.
The threat of firings has walloped morale and prompted many to explore employment elsewhere, according to the people. But JD, which hasn’t posted annual net income since its 2014 listing, has had three of its most senior executives announce departures within the past two months, including its CTO. It’s reportedly come under fire publicly for also effectively trying to lower the salaries of its couriers — once a source of company pride.
JD spokesman Brad Burgess declined to comment on the job cuts, saying only that the company was getting back to its entrepreneurial roots. JD Logistics said in a social media post that changing courier pay structures are necessary, with wages being protected for four to six months during the transition.
JD is now threatening to fire people that exhibit four kinds of behaviour: Arrogance, complacency, over-spending on expenses and failing to deliver on initiatives, said one of the people who saw the internal notice. The reductions come in part because the company hasn’t been regularly weeding out under-performers and a culling is now overdue, the person said. Earlier this year, JD said it intended to let go of 10% of executives ranked VP or above.
“With such ambiguity in the way JD is defining what constitutes a firing offence, it can be really disturbing for staff internally,” said Lion Niu, a Beijing-based senior consultant at CGL Consulting. Niu said his recruitment company had already received several inquiries from JD employees.
Between March 15 and April 5, JD announced that CTO Chen Zhang, general counsel and chief human resources officer Rain Yu Long and chief public affairs officer Ye Lan were departing, all citing personal reasons. — Bloomberg