Xingyu Auto Lighting Punishes Its Executives for Terminating 107 New Graduates

The general manager of one of China's largest automotive lighting suppliers will lose a year's salary. Its deputy general manager has been stripped of responsibility for human resources and docked six months' pay. Its HR director is dismissed; the head of the HR department, demoted. The punishments, announced on Monday by Changzhou Xingyu Automotive Lighting Systems, all answer a single decision: in early August, the company moved to push out 107 members of staff it had recruited from campus only weeks earlier.

The company's own account, published on Weibo on Monday, sets out the arithmetic. Across the 2025 autumn and 2026 spring recruiting seasons, Xingyu signed tripartite employment agreements with 440 graduates of the class of 2026 — the three-way contract binding student, university and employer that Chinese students sign before finishing their degrees, when a job offer hardens into something close to a promise. Of those, 372 joined the company after graduating this summer. In July, management cited order expectations and staffing needs and decided to cut some of the new positions; in early August the HR department selected 140 of the 372 for "negotiation." In the end, 107 signed termination agreements — 75 with bachelor's degrees, 32 with master's, most of them in R&D and manufacturing roles.

What turned the layoffs into a national scandal was how they were done. A recording leaked of HR staff offering what became known as the "choose one of two": resign voluntarily, citing "personal reasons," and collect half a month's salary in compensation — or refuse, and be reassigned unilaterally to frontline assembly work, as Shanghai outlet The Paper reported. For graduates holding signed three-party agreements, the offer read as a bait-and-switch, and the backlash was immediate and sustained. A post by Phoenix Tech carrying the punishment document on Monday was liked more than 15,000 times.

Monday's statement is unusually confessional by the standards of Chinese corporate public relations. "We accept every criticism from the public and the media," the company wrote, "and bear full responsibility." It also itemised the remedies: each of the 107 received three months' job-seeking subsidy of 5,000 yuan per month, paid in a lump sum on August 27; anyone still without a job three months on is entitled to six months' salary at their old rate; the Changzhou municipal and district human resources bureaus ran two dedicated job fairs and referred the graduates to matching employers. As of midday Monday, the company said, 71 of the 107 had started new jobs and another 22 held offers in hand; the remaining 14 were interviewing or preparing for postgraduate exams.

The contrition, though, is being read as damage control. "If Xingyu had issued this punishment at the very beginning, many people would have bought it," one widely shared post argued. "Issued now, people will only think: it isn't that you realised you were wrong — it's that things blew up." Others questioned who the penalties actually reach: "The person running HR is unlikely to have been the decision-maker here," one post observed.

The story has spread well beyond Weibo. Baidu's hot board carried it under two separate headlines on Monday, and Zhihu's front page posed the question directly — the general manager forfeits twelve months' salary, the HR director is fired: can this calm the storm? — alongside a blunter companion thread asking what, exactly, Xingyu did wrong.

For the 107, the affair is now as resolved as it will get: 71 in new jobs, 22 with offers, 14 still deciding. The penalties answer who pays for the decision; they do not change the arithmetic that produced it — a supplier reading its order book and concluding that 107 signed promises to fresh graduates were the easiest line to cut.