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央企工資改革 (yāngqǐ gōngzī gǎigé):?State-owned enterprise salary refor

China Daily | Updated: 2019-01-14 06:56
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Reform aimed at establishing a dynamic salary mechanism for State-owned enterprises that is fully linked to the performance of the companies came into effect on Jan 1.

Competition-oriented SOEs won't have to get approval from higher authorities for the total salary, instead they just need to report the total salary they distribute to higher authorities. The reform this time aims to establish a market-oriented income distribution mechanism that directly connects the salaries of employees of a SOE with the company's performance. The total amount of money for salaries will change according to how the performance of the SOE is. That means workers in SOEs can make more money if they did a good job and the SOE makes money, and they will possibly earn less otherwise.

Marketization is the ultimate goal of the reform. The reform means it is no longer necessary to limit the power of management to administrative means, but to manage in accordance with marketization requirements. Central SOEs will no longer be appendages of relevant parties, but independent market players.

Many local governments have also issued SOE salary reform regulations to promote the reform of salary distribution mechanism.

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