As winter approaches, China's cross-border e-commerce sector appears to be feeling the chill. Recent revelations about Guangzhou-based Banggood's decision to implement an extended leave policy for employees have sent shockwaves through the industry.
Controversial Leave Policy Raises Eyebrows
An internal email from Banggood disclosed that the company would place certain employees on extended leave starting November 10, 2022, citing challenging external conditions, weak overseas markets, pandemic disruptions, and supply chain instability. The policy offers full salary for the first month, followed by payments at 80% of local minimum wage from the second month onward, while maintaining social insurance contributions.
The most contentious aspect requires employees to refrain from taking other jobs during this leave period, with violations potentially leading to termination. Many industry professionals view this as a disguised layoff strategy to avoid paying severance compensation.
Financial Strain Evident in Payroll Adjustments
Further fueling concerns, Banggood has delayed performance bonuses originally scheduled for October to mid-November. The company also announced that salaries from October through December would be paid at the end of the following month or beginning of the third month, without fixed dates.
Industry analysts suggest these measures reflect significant financial pressure on the company, which has reportedly been struggling with declining performance amid rising logistics costs, international tensions, and ongoing pandemic challenges.
Industry Leaders Face Scrutiny Over Corporate Responsibility
The situation has sparked broader discussions about corporate responsibility in China's e-commerce sector. As a market leader, Banggood's actions carry particular weight and may influence smaller competitors.
Critics argue that companies facing financial difficulties should negotiate fair compensation packages with employees rather than implementing policies that effectively reduce wages while restricting alternative income sources.
Cross-Border E-Commerce at a Crossroads
The pandemic has accelerated transformation in global e-commerce, forcing companies to reevaluate product strategies, market expansion, and operational efficiency. While presenting challenges, this period also offers opportunities for industry reinvention.
The Banggood case highlights the importance of balancing business sustainability with employee welfare. Companies that prioritize both operational resilience and workforce support may emerge stronger from current market difficulties.
As of publication, Banggood has not issued an official response to the controversy. The situation continues to develop while prompting important conversations about labor practices in China's rapidly evolving digital export sector.