Changzhou Xingyu Automotive Lighting Systems Co., Ltd. (Xingyu) recently gave two options to this year’s recruited college graduates: either resign or work on the assembly line in the workshop. Some industry insiders speculated that this move by Xingyu before its second attempt to list on the Hong Kong stock exchange was a short-term financial report enhancement operation. However, several labor lawyers believe that Xingyu’s actions may violate the law.
In recent days, multiple recordings of conversations between Xingyu’s HR department and employees have been circulating online.
The recordings reveal that in early August, the company’s HR department conducted centralized interviews with all 2026 graduates and introduced a “choose one among two” arrangement: if a graduate voluntarily resigns citing “personal reasons,” they would receive half a month’s salary as compensation. Those who refuse to resign would be unilaterally reassigned by the company to basic frontline assembly line positions such as assembling car lights, plugging in connectors, and tightening screws, with their salary standards re-evaluated in accordance with the general worker system.
One of the graduates involved provided Litchi News with a recording of HR “persuading” them to leave.
Furthermore, Jiupai News revealed that during the interview process, there were implicit coercive tactics such as industry background checks and pressure, putting inexperienced graduates in a dilemma. This occurred just one month after these college graduates joined the company.
Multiple graduates disclosed to the media that there were originally over four hundred people in the graduate group, but after the downsizing, only around 120 remained, with approximately 70% no longer in the group. One master’s student mentioned that most of the graduates who joined with him had master’s degrees, and some even had doctoral degrees.
Jiupai News stated that a large number of resigning students have completely missed out on the exclusive job channels in 2026, such as civil service examinations and state-owned enterprise recruitment.
On August 25th, Xiao Liu from Jiangsu confirmed the incident to The Paper, saying, “My experience being hired and then laid off aligns with the reports. I received a compensation of 4,000 yuan (RMB) and have since left Changzhou, currently looking for a new job.”
Litchi News indicated that Xingyu had recruited a significant number of R&D, technical, and management trainee positions for graduates during the autumn recruitment of 2025, totaling around 400 people, including many from prestigious universities and master’s degree holders, with a promise of transitioning to technical positions after a month of production line internship.
An industry insider told The Paper that this unconventional personnel adjustment coincides with a crucial window for Xingyu’s second push for a Hong Kong stock exchange listing, which the market has questioned as a short-term financial report enhancement operation.
On July 29, 2026, Xingyu filed a second listing application to the Hong Kong Stock Exchange, restarting the halted “Mainland A + Hong Kong H” listing plan after half a year. Just a week later, the company initiated the centralized persuasion to leave for this year’s graduates.
The Paper cited analysts in the industry, saying that the core purpose of this precise personnel adjustment is to temporarily reduce labor costs, optimize per capita efficiency data, enhance financial statements, and pave the way for the Hong Kong IPO review.
However, several labor lawyers believe that Xingyu’s actions may be illegal. This includes unilaterally changing shift rotation periods, violating job position agreements in labor contracts, using punitive reassignments to force employees to resign, evading statutory economic compensation obligations, violating the principle of consensus negotiation in the Labor Contract Law, and being a covert illegal termination of labor relations.
According to the Xiaoxiang Morning News on August 26, Xingyu has suspended its HR director.
Public records show that Changzhou Xingyu Automotive Lighting Systems Co., Ltd., founded in 1993 and headquartered in Changzhou, is primarily engaged in the manufacturing of automobile components and accessories. It was listed on the Shanghai Stock Exchange in February 2011.