Mobile World's move after thousands of employees quit

As of the end of September 2024, the number of employees at Mobile World had decreased by nearly 5,200 people compared to the beginning of the year. The number decreased by nearly 14,000 people after two years.

After restructuring stores and staff, Mobile World decided to pay Tet bonuses several times higher than the same period last year - Photo: MWG

ESOP is the abbreviation of the English phrase "Employee Stock Ownership Plan" which means issuing bonus shares to employees.

This is a popular method applied by many companies, including Mobile World Investment Corporation (MWG), to encourage and reward employees.

Mobile World continuously recalls ESOP

Recently, MWG announced that it will buy back 431,179 treasury shares to recover the amount issued under the employee stock option program (ESOP) of retired employees.

The above shares will be repurchased by MWG with its own capital, with the purchase price specified in the ESOP issuance regulations.

The transaction is expected to be carried out by transfer of rights through the Vietnam Securities Depository and Clearing Corporation (VSDC), Ho Chi Minh City Securities will be the implementing agent.

The Gioi Di Dong has carried out the recall of ESOPs of resigned employees many times this year. The most recent recall took place in May this year, when MWG bought back 328,789 shares.

The recall took place in February this year, MWG bought back 154,211 ESOP shares. Last year, this company also conducted 3 ESOP recalls.

The withdrawal of ESOP from resigned employees takes place in the context that Mobile World is promoting the restructuring of its store system towards a more streamlined and efficient direction.

	Staff
2018	40757
2019	57608
2020	68097
2021	70472
2022	74008
2023	65414
9-30-2024	60258

Compared to the peak number of employees in 2022, by September this year, more than 13,700 employees of Mobile World had quit their jobs - Data: Financial statements

According to the financial report, at the end of September this year, MWG had a total of 60,258 employees, a decrease of nearly 5,200 people compared to the end of last year.

Nearly 14,000 fewer people in two years

The process of gradually reducing the number of employees of Mobile World has been going on since the end of 2022. This enterprise set a record of the number of employees exceeding 74,000 people in 2022 in the context of an increasingly difficult post-COVID-19 economy and reduced purchasing power.

The World Mobile Board of Directors has repeatedly mentioned that staff cuts are part of the group's comprehensive restructuring plan.

The more efficient apparatus also helps this enterprise increase the bonus cost for the remaining personnel. In the explanatory notes to the consolidated financial statements for the third quarter of 2024, MWG recorded the provision for employee bonus costs of nearly VND 1,700 billion at the end of September this year. This figure is 2.5 times higher than the VND 671 billion at the same time last year.

At the recent meeting to update MWG’s Q3 business situation, an investor asked the company’s management about the above-mentioned sudden increase in employee bonuses. In response, Mr. Vu Dang Linh - MWG’s CFO - explained that this was an advance payment to reward employees.

According to Mr. Linh, many businesses often pay out bonus funds quarterly, but with MWG, this amount is divided annually and will be paid at the end of the year.

"In 2023, business results were not favorable, so the company only awarded one month's salary to employees, which is the lowest level in the past 15 years," Mr. Linh replied to shareholders. But in 2024, business results were more positive, so the board of directors wanted to increase the employee bonus fund to encourage morale and take care of employees' lives.

"This is something that needs to be done and should be done so that the company can develop sustainably in the long term," the financial director of Mobile World emphasized, and said that looking at the absolute number of provisions in advance on the financial report, it will be seen as very large.

However, for a business with 50,000 - 60,000 employees like MWG, the amount spent on each employee is not much.

Source: https://tuoitre.vn/dong-thai-cua-the-gioi-di-dong-sau-khi-hang-nghi-nhan-su-nghi-viec-20241211161854701.htm