Pangdonglai Founder Sparks Controversy by Saying Employees 'Don't Deserve That Much Pay'

(Central News Agency, Taipei, 14th) Yu Donglai, founder of China's well-known retail group 'Pangdonglai,' has sparked controversy with recent remarks about employee salaries. He stated that over the company's 30-year history, it has paid employees beyond their expectations, but 'in reality, everyone doesn't deserve that much money.' The comments have drawn significant attention and criticism online in China, with Pangdonglai clarifying that it has no policy to reduce wages.

According to Chinese media outlets such as the Southern Daily, Yu Donglai said during an internal company seminar, 'For the past 30 years, the company has basically paid salaries exceeding employee expectations. The positive side is that it stimulates enthusiasm, but the downside is that it creates overindulgence.'

Yu also said, 'In reality, people don't deserve that much money, but because you're given so much, it creates a cognitive bias, leading you to believe you're actually worth that much.'

Yu stated, 'This might be excessive indulgence in policy.' He expressed hope that the company's human resources, finance, and operations departments should work together to establish a more scientific compensation system.

Analyzing the current industry situation, Yu noted that most Chinese companies fail to meet fair wage standards, while Pangdonglai's current salaries are double the industry's reasonable level, already 'out of control.' In response, the company has set a salary red line, aiming to cap future employee wages at 10% to 20% above the industry average.

He also claimed, 'Given Pangdonglai's current scale, a monthly salary of 6,000 yuan for employees is already very good. Anything above 6,000 yuan should not be taken.'

Last June, Yu Donglai revealed employee benefits showing that in 2025, over 8,000 Pangdonglai employees had an average after-tax monthly income of around 9,000 RMB (approximately NT$36,000). Estimated net profit was around 1.5 billion RMB, with an average distribution of about 100,000 RMB per employee, and 700,000 RMB for management and technical staff.

Yu's remarks have triggered intense online discussion in China. Some interpreted the comments as 'cost reduction and efficiency improvement, i.e., wage cuts,' asking, 'Why does high employee pay create cognitive bias, but the boss earning more doesn't? Ultimately, the boss just wants to earn more.' Others said, 'I just hope Chinese people can truly treat each other well.'

However, some support Yu, believing he's merely stating facts and that employees should have a sense of crisis. Others argue the remarks should not be taken out of context.

In response to the controversy, Yu stated that Pangdonglai has no policy to reduce wages. He explained that the company is only guiding employees through training to improve personal character and professional skills, align with company operational standards, and build confidence and the ability for a better life. 'Please don't misunderstand,' he urged.

Founded in 1995, Pangdonglai is a large retail group headquartered in Xuchang, Henan Province, China. Known for excellent service and treating employees well, the company differs from industry norms with higher salaries, shorter working hours, and increased rest days. Amid China's economic downturn, Yu's remarks have led Chinese netizens to suspect whether Pangdonglai is also moving toward 'cost reduction and efficiency improvement.' (Edited by Lu Chia-jung / Tang Pei-chun) 1150614