According to a report by Caixin.com, Wuhan Hongxin employees received a severance notice on the morning of February 26: “The company has no plan to resume work and production,” requiring all employees to apply for severance before the end of the day on February 28 and complete the severance procedures before the end of the day on March 5, 2021.
A number of Hongxin employees told the mainland new media “36 Krypton” that because the compensation package proposed by Hongxin management does not match the agreement signed by the employees when they joined the company, the employees are now refusing to resign collectively, and the two sides are at a standstill.
A Hongxin employee said that there are still 230 employees working at Hongxin, and the employees do not recognize Hongxin’s request to immediately offer to leave the company. The employee said that according to the requirements of the new labor law, Hongxin did not issue 30 days’ notice and needed to provide employees with “N+1” compensation (N is the number of years of employment).
Another employee said that the employees will take a complaint or labor arbitration to solve the problem.
On March 2, Hongxin proposed a final compromise: each employee would be paid one additional month of salary compensation, but the employee would be required to sign a letter of consent to leave the company voluntarily. But this move was not agreed by most employees.
According to insiders, Hongxin also launched a middle-level “coercion” to take the lead in signing the voluntary separation agreement.
The aforementioned employee described the company and the employees as having “officially torn their faces off”.
Hongxin was officially established in November 2017 in Wuhan’s East-West Lake District, with a claimed total investment of RMB 128 billion, and was twice selected as a major project in Hubei Province in 2018 and 2019, but was removed in 2020. However, it is still listed as a major project in Wuhan City.
Previously, Hongxin had been rumored to have defaulted on construction payments, broken funds, project stoppage, management departure, rotting and other unfavorable news. Until August 28, 2020, Wuhan East-West Lake District officials said that Wuhan Hongxin semiconductor project because of the capital chain problems, the special case suspended. In November of the same year, Hongxin was taken over by Wuhan East-West Lake District Government.
In the past six months, Hongxin has been rumored that “the company’s senior management and investors to discuss”, “to resume production”, “huawei and other investors to take over” and other news, but so far have not been implemented.
Wuhan authorities took over the Hongxin mess, dismissed the original founder, and sent a lobbying group to Shanghai and other places around to seek acquisition. A person familiar with the matter told “36 Krypton” that Hongxin has not been successfully taken over so far, “except for that lithography equipment, Hongxin no longer has any appeal, and it is not easy to find a company to take over.”
The report said that all kinds of performance can be seen, today’s Hongxin is close to the end of the bullet.
Some employees told that the company recently removed all the signs with the word “Hongxin” and replaced them with “Xin Gong Technology” – a sign outside the original temporary office building “Wuhan Hongxin Semiconductor Manufacturing Co. Ltd.” sign has been removed, and even the office “mouse pads with the word Hongxin have been removed”.
Previously, “36 Krypton” had a long article entitled “100 billion chip scam” pointed out that Wuhan Hongxin is a big scam. The key to the success of this $100 billion scam lies in the eagerness of governments around the mainland to “build a core”.
The mainland media has disclosed that since 2019, six tens of billions of semiconductor projects in Jiangsu, Sichuan, Hubei, Guizhou, Shaanxi and other provinces have been halted, and the industry is worried that the core-making fever has triggered a rotten tide.