Protest breaks out at HP subsidiary

A major protest broke out at a Hewlett-Packard Co subsidiary in China after thousands of employees refused to accept HP's China head as their new chairman on Monday.

Employees at H3C Technologies Co Ltd, a Hangzhou-based communications equipment maker purchased by HP in 2010, said the new appointment, which has not made official until Monday afternoon, will endanger the company's autonomy in operation.

Words about Mao Yu'nan, HP's chairman in China, will also head H3C's board of directors came in last week. Employees at H3C worry the arrival of Mao will hinder the company's China business and a long-awaited employee stock option plan.

H3C is a leading provider of data communications equipment provider in China. A considerable chunk of its business came from government procurement deals, a sector overseas providers find difficult to penetrate after the country lifted its alert on Cyber security.

H3C holds the largest market share in LAN switch and enterprise router markets in the country, according to the company.

More than 3,000 employees in Beijing and Hangzhou have signed a petition against the unconfirmed appointment, according to the organizers of the protest. H3C has around 4,800 employees. It has development facilities in Beijing and Hangzhou.

Matt Greenly, HP's vice-president in charge of worldwide finance and HP Networking businesses, arrived at the H3C headquarters in Hangzhou and will hold a meeting with local directors to discuss the appointment and the future of the company, said a H3C employee who gave his name as Etsan.

"Except the employees that provides necessary supports to existing customers, the rest of the company stopped operation today," he said, adding the development unit was also ordered to give a day off.

HP is yet to make any announcement concerning the incident.

"An independence and stable management team that knows the Chinese market will be the best choice for H3C," according to an employees' letter provided to Etsan.

The letter also said a H3C less controlled by its United States parent company is also good for the national security.

Mao, 70, was appointed as China chairman in 2013. He reports directly to Meg Whitman, president and CEO of HP.

It is the third strike evolving a major US tech company over the past 12 months. In early 2014, employees at an IBM server factory in Shenzhen, Guangdong province staged a strike after the facility was sold to Chinese PC maker Lenovo Group Ltd.

Thousands of Nokia employees also launched a weeklong strike in mid-2014 in protest of Microsoft Corp's decision of laying off around 5,000 of the workers - including mobile phone developers and workers on assembly line.