In the midst of China’s ongoing economic downturn, local governments are facing financial constraints, leading to widespread losses for metro companies. Recently, attention was drawn to a metro operating company in Yunnan province that has failed to pay its employees, with over 2 billion yuan owed in unpaid wages and pension.
According to a document shared by netizens, it was revealed that as of August 31, 2024, the Yunnan Jingjian Rail Transit Investment Construction Co., Ltd. had delayed paying its employees their salaries for July and August, amounting to 27.58 million yuan. Since March 2023, the company has also suspended payments for pension insurance, housing provident fund, and enterprise annuity.
Specifically, the pension insurance has accumulated arrears for 2,401 individuals, totaling 77.27 million yuan, while the housing provident fund has arrears for 2,204 individuals, totaling 74.39 million yuan, and the enterprise annuity has arrears for 2,030 individuals, totaling 27.57 million yuan, resulting in a total labor cost arrears of 208.50 million yuan.
According to a report by Benliu News on September 12, an employee of the Yunnan Jingjian Rail Transit Investment Construction Co., Ltd. disclosed that the company has indeed been withholding wages, with no pay issued for the past two months. The payment of pension insurance has also been halted since March last year.
In fact, as early as September last year, the issue of unpaid wages for a large number of employees in Kunming Metro had sparked discussions.
As reported by The Paper earlier, an employee of Kunming Metro Operation Co., Ltd. mentioned that the wage arrears issue began in September 2022 and was only resolved by the end of December that year. However, the wage arrears problem started again from January 2023, with three months of wages being withheld each time and no contributions made for pension insurance and provident fund.
A representative from the Kunming Municipal Government stated that they were aware of the wage arrears issue concerning metro company employees some time ago and are presently exploring solutions, as public transportation and rail companies often face similar problems.
On the official account of Kunming Metro, numerous posts demanding salary payment by employees have emerged in the past two weeks. From the posts, it appears that several thousand frontline workers have not received their salaries for up to 10 months, leading to difficulties in paying for health insurance and even basic necessities like food.
Public records indicate that the Yunnan Jingjian Rail Transit Investment Construction Co., Ltd. is a limited liability company established on December 7, 2017, with investments from Kunming Rail Transit Line 4 Investment Management Co., Ltd. (representing government investment holding 14.2% share), Beijing Urban Construction Design & Development Group Co., Ltd. (social investor holding 78.28% share), and China Railway Electrification Bureau Group Co., Ltd. (social investor holding 7.52% share). The company, as the implementing agency of the PPP project, operates under the supervision of the Kunming Municipal Transportation Bureau, handling the investment, construction, and 30-year operation of Section B of Kunming Metro Line 4, with a workforce of over 2,200 employees.
As China’s economy continues to decline, metro companies across the country are facing financial losses. In a surprising turn of events, even the previously lucrative Shenzhen Metro Group, once dubbed as the “most profitable metro company in China,” reported its first losses in a decade in the first half of this year.
As reported by Nandu Daily on September 7, the financial statements released by Shenzhen Metro Group Co., Ltd. revealed a net loss for the first time in a decade amounting to 3.793 billion yuan for the first half of this year. By the end of June, Shenzhen Metro Group’s total liabilities stood at 419.997 billion yuan.