Xiaohongshu’s Rare Public Stance: Reflecting on Labor Dispute and Launching an HR System Review

Caixin’s report on Xiaohongshu’s IPO highlighted that the company chose to address the recent labor‑dispute controversy directly, opting for a mainstream media interview rather than the usual silent legal statement.

Company statement: Xiaohongshu said it respects judicial decisions, has fulfilled all legal obligations, and continues to respect employees who protect their rights through legal channels.

The firm announced that it has launched an internal review of the relevant management processes and has invited independent third‑party experts and institutions to conduct a systematic audit of its HR policies and procedures.

This approach signals a willingness to accept external supervision and to invest effort in improving its management system, though the ultimate impact will depend on how seriously any identified issues are addressed and whether corrective measures are fully implemented.

The report also covered rumors about large‑scale layoffs and stock‑option adjustments. Xiaohongshu’s management denied the layoff claims and said it was unaware of any “50‑person lawsuit.” Regarding stock options, the company clarified that from 31 December 2023 the vesting period changes from two years to one year, with the four‑year vesting schedule adjusted to 15%, 25%, 25%, 35%.

Looking back, the Chinese internet sector’s past decade was dominated by “efficiency‑first” thinking, leading to coarse‑grained labor practices such as 996, 007 schedules and the “35‑year crisis.”

Now, with growth slowing and younger generations (post‑90s, post‑00s) more legally savvy and vocal on social media, companies can no longer rely on aggressive scaling and must adopt refined, transparent management practices.

Thus, Xiaohongshu’s public stance reflects an emerging industry trend: moving from pure efficiency to respecting procedural justice and employee rights. Observers are advised to watch the follow‑up actions—whether third‑party reviews lead to tangible improvements and how employee experiences evolve over the coming months.