Moves are being taken by the Chinese government to claw back
salaries following suggestions that staff in state-owned
enterprises (SOEs), particularly those in monopoly sectors, were
overpaid.
The Ministry of Labor and Social Security and the Ministry of
Finance have jointly issued an order to strengthen controls on the
salaries paid to SOE employees. Local governments have been
instructed to ensure their pay is linked to economic
performance.
SOEs, where salaries are more than double last year's local
urban average, should be reviewed strictly. And pay at such
enterprises that experience a fall in profits should be reduced,
according to the order.
Some SOEs are able to make big profits because of their monopoly
status. Instead of handing over the excessive profits to the
government, they've been paying their staff -- managers and
ordinary workers -- very high wages.
Sky-high pay at SOEs, especially those in monopoly sectors, has
aroused public anger. Salaries in electricity, petroleum, finance
and telecommunications enterprises are hotly debated on the
internet.
The Beijing News reported last Friday that public
pressure had led to a 20 to 50 percent drop in salaries in the
electricity sector this year.
Non-state controlled enterprises should negotiate pay with
employees according to company policy, states the circular.
(Xinhua News Agency December 5, 2006)