Under difficult circumstances, every move of Tencent, a big Internet technology company, has attracted attention. On June 1, the Chinese reporter of the securities times securities firm learned that Tencent issued a notice on salary review and adjustment to employees on May 31. There are two main points: first, Tencent will no longer make immediate salary adjustment for rank promotion alone in the future; second, the annual salary review will be changed from June to July and implemented immediately.
According to Tencent's official caliber, the adjustment does not mean that the promotion has nothing to do with the salary, but will comprehensively evaluate whether to adjust the salary in the annual salary review in combination with multiple factors such as "performance contribution, ability improvement and salary competitiveness", which will have a more complete perspective.
This means that Tencent's adjustment has changed the previous impression of "promotion = salary increase", and further strengthened the direct connection between salary increase incentive and performance and performance evaluation.
In fact, like other Internet technology enterprises, Tencent has been under pressure since 2021. In the first quarter of this year, its revenue was 135.5 billion yuan, almost zero year-on-year growth. According to non international accounting standards, its net profit was 25.55 billion yuan, a year-on-year decrease of 23%. At the same time, the news of layoffs in related business lines also came from time to time.
Salary reform: promotion is not equal to direct salary increase
On May 31, Tencent's "compensation and Welfare Department" released an e-mail "notice on salary review and adjustment", which attracted internal and external attention and was listed on the hot search list.
According to the email, the company will conduct an overall review of the current salary level of employees every year according to its own business planning and external market conditions, and the specific review time will be planned according to the actual situation of the year. There are two main changes this year. Please understand:
- The 2022 annual compensation review will be launched in July. This adjustment is mainly to ensure that the salary review is more matched with the half year performance evaluation, and to solve the problem that there is no latest performance result during the annual salary review in the past June, so as to strengthen the link between incentive and performance evaluation, and ensure that the students who have made contributions receive due returns.
- No immediate salary adjustment will be made solely for rank promotion. Relevant salary adjustment resources will be integrated with annual salary review resources. This adjustment does not mean that the promotion has nothing to do with the salary, nor does it cancel the corresponding resources, but to give managers a more complete perspective when reviewing the salary annually.
According to the above email, the company recognizes the ability improvement and higher responsibility requirements represented by promotion. At the same time, it also requires to use "martial arts" to establish "military merit" and convert the ability improvement into performance contribution. Therefore, the annual salary review will be comprehensively evaluated in combination with performance contribution, ability improvement, salary competitiveness and other factors. (Note: the promotion of H2 cycle in 2021 has taken effect in April. If there is any promotion salary adjustment of this cycle, the relevant adjustment will remain effective in April).
For this round of salary adjustment, an insider of Tencent told reporters that previously, the salary was adjusted immediately after the direct promotion. This time, the salary was adjusted immediately after the cancellation of the rank promotion. Later, it will be integrated into the incentive resource package of the annual review. The adjustment does not mean that the promotion is disconnected from the salary incentive. The purpose behind the adjustment is to help managers have a more comprehensive perspective in the annual salary review incentive.
At the same time, this year's annual salary review (i.e. the annual general salary adjustment opportunity for all Tencent employees) was adjusted to start in July to ensure that the salary review is more matched with the performance evaluation in the first half of this year, so as to solve the problem that the performance evaluation in the first half of this year has not been completed during the previous annual review in June.
Several Tencent employees confirmed to the Chinese reporter of the securities times and securities companies that they had received the e-mail of the above salary review and adjustment, "promotion does not necessarily mean a raise, and whether a raise is more closely related to performance and performance." A Tencent employee told reporters.
Some netizens said, "the big Internet companies have also rolled up?"
Performance under pressure, seeking cost reduction and efficiency increase
Affected by the epidemic and other factors, Internet technology enterprises have also sought to reduce expenditure, reduce costs and increase efficiency, and the news of layoffs has also been heard from time to time.
Tencent's revenue in the first quarter of this year was 135.5 billion yuan, almost zero year-on-year growth. According to non international accounting standards, the net profit was 25.55 billion yuan, a year-on-year decrease of 23%. In terms of the profit attributable to Tencent's equity holders, the decline was even greater, achieving a net profit of 23.4 billion yuan, a year-on-year decrease of 51%, resulting in a "half cut".
As for the decline in net profit, Tencent explained that it was mainly due to the fact that the overall increase in costs and expenses was faster than the income, and the net contribution made by associated companies changed from profit to loss.
It is worth mentioning that Tencent's net profit fell in the first quarter, which is also closely related to the substantial increase in expenditure.
According to the data, Tencent's general and administrative expenses in the first quarter of this year reached 26.7 billion yuan, a year-on-year increase of 41%. According to the financial report, this was mainly due to the increase in share remuneration expenses, R & D expenses and employee costs, and the increase in expenses of overseas subsidiaries.
Ma Huateng said in the financial report that during the challenging first quarter of 2022, "we have implemented cost control measures and adjusted some non core businesses, which will help us achieve a more optimized cost structure in the future."
As of March 31, 2022, Tencent had 116213 employees, a year-on-year increase of 30.2%. In the first quarter of 2022, the total remuneration was 29.229 billion yuan, a year-on-year increase of 43.2%.
At the same time, in the first half of this year, Tencent also revealed that there were layoffs in Tencent cloud, game business, advertising business, content business lines and so on.
At the first quarter performance conference of Tencent, Tencent executives said that the more personnel, the higher the cost. Therefore, structural changes are needed to focus on more profitable businesses. At present, there are structural changes in the industry, and the company may optimize personnel, but transient factors such as the epidemic situation will not be the reason for optimization. Therefore, on the whole, cost reduction and efficiency increase is a comprehensive consideration.