Social Sciences in China (Chinese Edition)

No.8, 2015

Evolution of the Annual Bonus System in Enterprises around Suzhou before and after the Founding of New China

(Abstract)

Wang Weiping and Wang Yugui

The granting of annual bonuses to employees in enterprises was a common practice in industrial and commercial enterprises in the Suzhou area before 1949. In the late republican period, when prices soared and the people could barely eke out an existence, the issuing of annual bonuses became an important way for workers to win rights and benefits from their enterprises. The annual bonus thus exhibited the character of a means by which the owner of the enterprise could pursue the maximization of surplus value. After the founding of “New China” in 1949, the working class became “masters of the country,” but for reasons of historical continuity and the composite nature of the New Democratic economy, the system of annual bonuses was retained in full. With the proclamation of the General Line during the transitional period in 1953, a marked change took place in the annual bonus system. In 1956, when the socialist transformation was basically completed, the system was eliminated, thus guaranteeing the interests of the working class. The year-end bonus system implemented since reform and opening up in 1978 is an institutional innovation rather than a simple regression. It is an evolutionary process suited to the historical orientation of a socialist country and the primary stage of socialism. It displays the unity of the interests of workers and those of the state, but is full of complex overlapping and blended elements. It needs to be presented in detail adhering to the principles of Marxist historicism.