Chinese authorities have launched an investigation into working conditions at Pinduoduo Inc. following the death of an employee in his early 20s, which has renewed criticism of the long hours commonly practiced at Chinese technology companies.
The e-commerce company confirmed that an employee collapsed as she walked home with colleagues at 1:30 a.m. last Tuesday. The employee, born in 1998 and joined Pinduoduo in July 2019, could not be resuscitated and died after nearly six hours of first aid, according to a statement. His death sparked a backlash on social media against Pinduoduo and the incessant working hours expected of his workers, prompting district officials from the Shanghai Municipal Human Resources and Social Security Bureau to open an investigation.
The said 996 office hours – 9 a.m. to 9 p.m., six days a week, plus overtime – has drawn criticism in previous years following complaints from tech workers and earlier death. Yet the tech billionaires of Ali Baba Jack Ma, founder of Group Holding Ltd. JD.com Inc. Chief Richard Liu endorsed the practice as necessary for survival in an intensely competitive industry and as the key to accumulating personal wealth.
Subscribe to Eastworld for a weekly snapshot of what’s leading business in Asia, delivered free to your inbox.
“Chinese internet companies should think beyond unicorn status and IPOs and a stable and healthy corporate culture is essential for long-term growth,” said Marlon Mai, managing director of the consulting firm. Shanghai-based Morgan McKinley recruiting. “The health of employees is an issue that cannot be ignored.”
Online criticism adds to challenges for China’s biggest tech companies, which have spent the past year pushing back the Trump administration’s efforts to curb growth while facing increased regulatory scrutiny at home. In November, Beijing unveiled regulations designed to stamp out monopoly practices in the internet industry, sparking a massive sell-off in the previously high-profile tech sector.
Despite the year-end slump at Alibaba and its peers, Pinduoduo had been relatively unscathed, with its stock breaking to a record on December 30. Shares of the company, which spans a $ 205 billion e-commerce empire and actively seeks to further boost growth by expanding into the hot online grocery industry, ended the year up nearly 370 %. This helped elevate founder Colin Huang to China’s second richest man, ahead of other internet entrepreneurs like Ma and Alibaba. Tencent Holdings Chairman Pony Ma, according to the Bloomberg Billionaires Index. Pinduoduo sank 6.1% in New York on Monday.
Hashtag on employee’s death attracted over 260 million views on Sina, similar to Twitter Weibo service from Tuesday. Criticism of the online retailer intensified after Pinduoduo confirmed that a post on the Quora-like Zhihu service – which said all people in the lower echelons of society were trading their lives for money – came from his official account. After initially claiming the message was bogus, Pinduoduo laterexcuseand said an entrepreneur had downloaded it without permission, adding that the company strongly opposed the views expressed.
Public video surveillance on Tuesday released acommentwhich warned against trading in human life for profit. Without naming specific companies, CCTV called on authorities to step up regulatory oversight to protect workers’ rights.
In response to the outcry, the Shanghai Municipal Human Resources and Social Security Bureau will send an investigation team to Pinduoduo and collect relevant information from the company, an official from the Changning district branch said by phone. who only wanted to be known as Wang to Bloomberg News.
More to read absolutely technological coverage of Fortune:
- A brief history of Bitcoin bubbles
- Commentary: Why the United States Needs a national climate investment fund
- the the biggest conspiracy theories of 2020 (and why they won’t die)
- Why Julian Assange’s victory does little to help the cause of press freedom
- Comment: Marketers Can’t Predict What You’ll Buy– Even if they use AI