Billionaire JD.com founder Richard Liu slams underperforming employees as e-commerce giant faces increasing competition

“(For people who) are poor performers and don’t work hard, the company will not tolerate them and will eliminate them,” the 51-year-old entrepreneur said in a video that has been circulating on social media and has been widely reported by local authorities.

High performers shouldn’t have to work overtime, but average, hard-working employees can also be sure they won’t be fired, Liu added.

They also stand in contrast to previous comments from Liu, who repeatedly emphasized the camaraderie in the company’s culture, calling employees “my brothers.”

The strong words come after the Beijing-based company made a number of changes to its work schedule and working time policies, including shortening its lunch break from two hours to one hour, and making extra efforts to prevent “buddy punching” – a descriptive term According to people familiar with the matter, employees clock in for colleagues who are late or absent.

One JD.com executive, who declined to be named because he is not authorized to speak to the media, said the company hopes the changes will help correct sloppy management over the past few years.

There have been serious problems in some major business units and the latest efforts to instill discipline in employees are much needed, according to the person, who also stated that the company expects the changes to motivate employees and provide a fair environment for those willing to work to fight for better performances .

JD.com did not immediately respond to a request for comment on Tuesday.

On Monday, the company announced it would gradually increase annual severance pay for procurement employees from four months’ salary to eight months’ salary, with no upper limit on additional bonuses. The increases will take place in stages, starting from July 1.

This followed two rounds of pay increases in recent quarters, including an average 30 percent raise for front-line customer service workers and a doubling of salaries for procurement and sales workers.

According to Li Chengdong, head of think tank Dolphin, the carrot and stick approach reflects Liu’s concern about how to sustain growth in an increasingly competitive e-commerce landscape.

“As a company matures, it may develop characteristics of a large company, such as having employees who become less motivated and less productive,” Li said. “The company may be able to ignore these problems as long as it continues to grow, but given that competition is now growing much faster, the company is trying to be more agile. “

To address this issue, JD.com has developed strategies to lower the prices of products sold on its platform using PDD Holdings, the operator of the Pinduoduo budget shopping app. These include a “10 billion yuan discount” campaign, as well as flash sales and free shipping on products priced as low as 9.9 yuan ($1.4).