China’s No 2 server maker H3C to cut pay for senior employees amid uncertainty of US tech sanctions
- The pay cuts, which take effect from December 1, could be extended or terminated earlier, depending on the company’s operating conditions
- Unisplendour, a listed arm of Tsinghua Unigroup, owns a 51 per cent stake in the company, which was founded by Huawei and 3Com in 2003
H3C Technologies, a Chinese server maker, has decided to cut the pay of its mid-to-senior-level employees, as the impact of the latest US tech sanctions spreads from cloud service providers to the digital infrastructure market.
In an internal memo last Thursday, H3C CEO and president Yu Yingtao said employees and managers rated grade 17 and above would face a 20 per cent pay cut, while employees and managers at grade 16 and all grade 15 managers would face a 10 per cent cut, according to a report on Friday by Chinese financial news media Caixin, citing sources.
Yu said the salary adjustments, which will be in effect from December 1 to the end of next year, could be extended beyond that period, or terminated earlier, depending on the company’s operating conditions.
H3C, which buys chips from suppliers including Nvidia to make servers, declined to comment on Sunday.
The planned pay cuts were confirmed on Sunday by an H3C employee, who requested anonymity because the information was private. The source added that grade 17 was deemed a senior position and would only impact a small number of employees. H3C has a workforce of more than 19,000.
The internal employee grading system at H3C, similar to that of many Chinese tech companies, starts from eight and tops out at 20.