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  • Kyle Chua

Xiaomi-Backed Black Shark Struggling To Pay Severance of Laid Off Staff

Black Shark, a gaming phone subsidiary of Xiaomi, has drawn the ire of its former staff as it struggles to cough up the severance payments owed to them.

Black Shark 5 series. Credit: Black Shark

The company sent a text message to its former staff on Tuesday, explaining how it had experienced "tremendous operational difficulties" and won't be able to pay severance in full yet, as the South China Morning Post (SCMP) reports, citing Chinese media. It also said it's finding funding solutions to be able to pay the remainder of the severance payments owed to the laid off workers.


Black Shark had conducted multiple rounds of layoffs since August last year after Shenzhen-based internet juggernaut Tencent walked away from a deal to acquire it. The company shrank its payroll from more than 1,000 last year to just over 100 now.


A number of the laid off workers reportedly took to Chinese social media platform Weibo to air their frustrations about the company's failure to pay their full severance. "Please pay the severance. I need the money for the Lunar New Year," reads one comment.

Black Shark CEO Harrison Luo. Credit: Black Shark

A recent post by Black Shark CEO Harrison Luo that reads "Good morning" was also flooded with angry replies from former workers demanding what is owed to them. Some of them said they only received 2,000 yuan from the company. "How can I get through the Lunar New Year with 2,000 yuan in compensation? How can I tell my family about this," the commenters asked Luo.


One former worker told SCMP that he's owed 150,000 yuan in compensation. More than 100 affected workers have already filed cases with labour authorities in Shanghai's Pudong district after failing to contact the company's executives.


Tencent began talks with Black Shark in January 2022, with the plan of having it develop virtual reality headsets for metaverse content, but later aborted the deal after failing to get approval from authorities.

 
  • Black Shark, a gaming phone subsidiary of Xiaomi, has drawn the ire of its former staff as it struggles to cough up the severance payments owed to them.

  • In a text message sent to former staff, the company explained how it had experienced "tremendous operational difficulties" and won't be able to pay severance in full yet.

  • Black Shark had conducted multiple rounds of layoffs since August last year after Shenzhen-based internet juggernaut Tencent walked away from a deal to acquire it.

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