Li Auto, a Chinese automobile company, was to conduct a significant round of layoffs in early May. As per media reports, the company has let go of 18 per cent of its workforce, that is, about 5,600 employees.
However, as per fresh information from a Chinese daily on 28 May 2024, the situation may be far grimmer. Former employees assert that the actual number of layoffs is closer to a staggering 10,000.
The company has also confirmed a substantial workforce reduction, with employee numbers falling from over 30,000 to around 22,000 during this layoff period. The cuts have been particularly severe in specific departments.
The HR department may have seen up to 60 per cent of its staff let go, while teams working on the parking project and the LIOS operating system may have experienced layoffs of up to 50 per cent. The Li Auto AD Pro project team was reportedly almost entirely disbanded.
Discontent is brewing among the laid-off employees over compensation. Many argue that Li Auto did not adhere to regulations regarding severance packages, providing insufficient compensation for employees on probation and failing to include a notice fee equivalent to one month’s salary. The company also offered cash for unused annual leave at twice the rate instead of the expected three times.
Additionally, Li Auto has tightened its benefits and expense policies. As of April, the company discontinued lunch subsidies and overtime dinners. It also delayed the eligibility for taxi fare reimbursement for those working overtime by an hour and restricted the areas eligible for reimbursement.
Furthermore, office supply requests are now limited to one pack of napkins per month and one monitor per coder.
