Xibei, the renowned Chinese restaurant chain, is facing significant backlash from former employees regarding delayed payments, including end-of-year bonuses, severance packages, and share buyback funds. Originally scheduled for payment according to prior agreements, these dues are now reportedly being pushed back, with some payments not expected until 2028.
Payment Revisions and Employee Concerns
Recent reports indicate that in late July, Xibei notified employees about revised payment schedules. This has led to considerable distress among those who have left the company. The new terms outline a staggered payment plan for various financial obligations:
- 2025 Year-End Bonus: This bonus will reportedly be paid in five installments, each representing 20% of the total amount, by the end of 2026. If interest was originally stipulated, payments will adhere to the initial agreement before July 1, 2026, after which an annual interest rate of 8% will apply.
- Severance Pay: Outstanding severance amounts will accrue interest at 8% annually starting from July 1, 2026. Payments are planned in stages: 15% in the first half of 2027, another 15% in the second half of 2027, followed by 25% in the first half of 2028, and the remaining 25% in the second half of 2028.
- Equity Transfer Payments: Similar to severance, unpaid portions of equity transfer amounts will accrue 8% annual interest from July 1, 2026. Further phased payments are slated before December 31, 2028, contingent on business recovery.
One former employee shared insights from an online meeting with Xibei founder Jia Guolong. He reportedly asked employees to trust the company’s ability to recover, but acknowledged that immediate payment was not possible, hence the extended timeline to 2028.
As of the time of reporting, Xibei had not issued an official response regarding these payment modifications.
Background of Financial Strain
This situation follows a period of significant operational adjustments for Xibei. In late February, the company reportedly underwent large-scale staff reductions, a move that came after controversies surrounding pre-prepared dishes. At that time, agreements were in place regarding salary deferrals during periods of negative store cash flow. For employees earning over 20,000 yuan per month, 50% of their salary would be deferred; those earning between 10,000 and 20,000 yuan would have 80% deferred, while those earning 10,000 yuan or less would receive their full salary. Deferred amounts were expected to be paid back within March, April, and May. The 2025 year-end bonus was then scheduled for July 10, 2026, with 6% annual interest.
Original agreements for termination also stipulated a phased payment of severance: 20% the month following termination, 30% by the sixth month, and the remaining 50% by the end of 2026. An option was also presented for severance pay to be converted into company shares at double the compensation value.
Employees facing termination could also opt for a 3- to 6-month unpaid leave of absence, with the company covering minimum social security and housing fund contributions. They would be eligible for re-employment upon business normalization.
Furthermore, agreements concerning the buyback of shares from departing employees outlined a payment structure mirroring the severance installment plan: 20% the next month, 30% by the sixth month, and 50% by the end of 2026. These payments could also be converted into company loans, subject to the company’s loan interest policy.
The latest revelations suggest a significant shift in Xibei’s financial commitments, impacting a substantial number of former employees and raising questions about the company’s financial stability and its handling of employee compensation.
