Huang Xiuhong the sister of Huang Guangyu, once the wealthiest man in China, is the chairman of Gome Electric in the Beijing Pengrun Building.

Chinese overseas outlets on November 4 reported that Huang Xiuhong told all employees at the headquarters on October 28 that the company would provide employees with social security but no wages until the end of December. 

There are also uncertainties about the future mid-to long-term wage distribution. 

Huang Xiuhong even criticized the employees’ recent work attitude, believing that none of them understood the overall situation. 

Xiuhong said that during difficult times, they should not consider personal gains and losses and must advance and retreat together with the company.

A Gome employee said to the author of Prism: Is this illegal? It is to force people to leave in disguise—none of us will sign. 

However, if the employee voluntarily resigns now, he will be owed tens of thousands of yuan in wages since the first half of the year. 

According to Gome’s 2022 interim report released on September 27, Gome’s total liabilities reached $8.1 billion (58.567 billion yuan).

Bank loans and other loans to be repaid within one year amounted to $31.5 billion (229.02 billion yuan). 

According to Tencent News Prism, Gome’s cash and cash equivalents are only $331m (2.409 billion yuan).

According to China’s Caixin Weekly, Gome closed 90% of its stores in the third quarter of 2022. It now has less than 500 operating, and its branches have merged from 40 to about 30. 

The employees revealed that the company stopped paying the provident fund starting in May. 

Later, some employees did not receive social insurance, and the assessment points deduction items also increased randomly, resulting in a general decrease of 20%-30% in their salaries.

The company enforces a pay cut even if the employee doesn’t sign off on the salary adjustment plan. 

The total number of employees of Gome Retail has decreased by 10,000 people from the end of 2021 to June 2022.

Some Gome employees said, “I heard that the boss is raising money everywhere and wants to sell the building.” 

Gome has suffered severe losses quickly because of investing heavily in the e-commerce platform “Really Happy” app in the past year. However, the platform has received little response. 

Since the first half of this year, the employees have revealed that the True Happiness platform has been suspended from business investments.

However, according to Tencent News Prism, Huang Guangyu again threw out a new target to achieve a higher profit in 2023 and the best level in history in 2024. 

Huang Guangyu, once the wealthiest man in China, was jailed for 14 years for stock market manipulation. He was released at the end of 2021.

“Prism” reported in April this year that Huang Guangyu has firmly controlled the company since his release. 

Now that has changed. Gome employees said that since June, they have not felt that “Boss Huang is involved in business,” and now all business lines of Gome have entirely fallen into the hands of his sister Huang Xiuhong. 

With Gome’s continuous loss of employees and executives and unpaid salaries and compensation, no one is willing to believe in Huang Guangyu’s revival plan.

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