Amazon walking back raises after internal bug miscalculated compensation

Post by thakoppno » Mon, Sep 26, 2022, 2:54 PM UTC

jonhohle wrote: post #20

platelminto wrote: post #5

So it's likely that previous bonuses/raises were also based on 'old' stock prices. But since Amazon stock was (pretty much) always increasing, this means that those bonuses were consistently lower than what they should've been. Of course it's only an issue now when the opposite is true, and is costing Amazon rather than the employees.

When I was last there (albeit 6 years ago), following reviews managers determined what your new “total yearly comp” would be. Base pay was pretty low compared to industry, but RSUs were used to make up the difference based on the price on a certain date with a 4-year vesting period, distributed quarterly (16 distributions). For example, if your total comp required 20k extra per year and the stock price was $100, you’…

Post by arbitrage » Mon, Sep 26, 2022, 2:58 PM UTC

JKCalhoun wrote: post #18

platelminto wrote: post #5

So it's likely that previous bonuses/raises were also based on 'old' stock prices. But since Amazon stock was (pretty much) always increasing, this means that those bonuses were consistently lower than what they should've been. Of course it's only an issue now when the opposite is true, and is costing Amazon rather than the employees.

Ha ha, back in the late 90's, Apple took away profit sharing as soon as there was a profit. Specifically, I should say, Steve Jobs took away profit sharing.

Post by BeetleB » Mon, Sep 26, 2022, 3:01 PM UTC

a-priori wrote: post #15

s1artibartfast wrote: post #8

Earlier quoted context omitted.

Why would they get a fixed number of RSUs. I have always seen them assigned in dollar value, usually as a % of dollar salary

RSUs are always granted as a number of shares. It's kind of the point of them, so the employee benefits from stock appreciation since their hire date. However, in offer paperwork, it will sometimes be stated as a dollar value. This is for two reasons: the first is that RSUs need to be approved by the board at a meeting, which can happen some time after the hire date, at which time the dollar value is converted into s…

Post by cj » Mon, Sep 26, 2022, 3:05 PM UTC

thakoppno wrote: post #22

jonhohle wrote: post #20

Earlier quoted context omitted.

When I was last there (albeit 6 years ago), following reviews managers determined what your new “total yearly comp” would be. Base pay was pretty low compared to industry, but RSUs were used to make up the difference based on the price on a certain date with a 4-year vesting period, distributed quarterly (16 distributions). For example, if your total comp required 20k extra per year and the stock price was $100, you’…

> We always wanted the stock price to have a temporary low around review season because that would benefit our RSU grant. What a perverse incentive. I would love to know if any high-profile outages are clustered around those dates.

Post by deeblering4 » Mon, Sep 26, 2022, 3:10 PM UTC

axg11 wrote: post #11

Amazon should just own this mistake. They are already finding it incredibly hard to recruit and attract top talent. Perhaps the situation is slightly improved with the recent cooldown in the economy. I wonder how much this negative PR costs their recruiting efforts when compared to the cost of paying up the erroneous bonuses.