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Amazon walking back raises after internal bug miscalculated compensation

businessinsider.com

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Re: Amazon walking back raises after internal bug miscalculated compensation

#81

Post by michaelt »

hn_throwaway_99 wrote: post #45

Two things going on here: 1. First, I'm a bit baffled by some of the responses along the lines of "Amazon should just own their mistake". Sorry, but in the real world, "finders keepers" rarely applies (unless you're talking about crypto, but I digress...). I would certainly want a bug corrected if it were in my favor, and if a bug went the other way, I might need to re-evaluate my company satisfaction based on my new…

> Sorry, but in the real world, "finders keepers" rarely applies

If Bob signs a contract for Alice to paint a fence for $800 and a copy-paste error transfers her $1000 instead, yes.

But if the copy-paste error happened before the contract was signed? Leading to Bob promising Alice $1000 and signing a contract promising it? Then in all probability, Bob will end up paying the contract amount.

Re: Amazon walking back raises after internal bug miscalculated compensation

#83

Post by [deleted] »

travisjungroth wrote: post #63
hn_throwaway_99 wrote: post #45

Two things going on here: 1. First, I'm a bit baffled by some of the responses along the lines of "Amazon should just own their mistake". Sorry, but in the real world, "finders keepers" rarely applies (unless you're talking about crypto, but I digress...). I would certainly want a bug corrected if it were in my favor, and if a bug went the other way, I might need to re-evaluate my company satisfaction based on my new…

This is not finders keepers. The article is slightly vague, but my takeaway is that employee got raises. Those numbers went through a bunch of people. The pay went out for months. Then, they realized they miscalculated the raises. “Whoops, we didn’t mean to offer you $150k, but really $140k.” 1. I think they have no chance at getting back the pay from before. This isn’t a banking error, this is regret. As an employee…

[deleted]

Re: Amazon walking back raises after internal bug miscalculated compensation

#84

Post by tomrod »

dcre wrote: post #64
denton-scratch wrote: post #43

I don't get it (I never worked for Amazon!). I've never worked anywhere, where a change in my employer's stock price means my pay has to be recalculated. If you're promoted and given a raise, isn't that a deal? Suppose I'm a happy coder on $X, and you promote me to the miserable job of Project Manager on $X+10, how's it legal to call me into the office and explain that it's actually $X+2? Is compensation at Amazon st…

They are paid a number of shares and given an estimate of the value of those shares based on some share price. Amazon used an old share price, so the estimate was too high. The only thing being recalculated is the estimate. The number of shares does not change.

Sounds like it deviates pretty significantly from AMZ's prior practice, where the RSU count matches ${promised comp}.

So AMZ made a mistake and changed the employee agreement. Seems unethical to walk that back, despite it potentially being legal.

Re: Amazon walking back raises after internal bug miscalculated compensation

#85

Post by BeetleB »

travisjungroth wrote: post #58
BeetleB wrote: post #26

Earlier quoted context omitted.

Since there are comments saying things like "I've never seen them based on dollar value": My well known company has always granted stocks based on dollar value. Many employees incorrectly thought it was "number of shares", but if anyone actually asked the manager who decided how many shares they would get, the answer was always "We're given a dollar budget in shares to allocate amongst our reports - the system then c…

I think people in this thread might be talking past each other. I get a manager could be told “you have $500k of 4 year grants to give out this year”. He tells an employee “you’re getting a $100k 4 year grant.” Stock is $100 today, so that’s 1,000 shares, or 250 per year. A year passes. Stock goes to $50. Here’s my big question: Are they still getting 250 shares this year from that grant (now with a value of $12,500)…

Ah I get it. Yes, even in my company, it would still be 250 shares.

Re: Amazon walking back raises after internal bug miscalculated compensation

#86

Post by Ekaros »

cooneyb wrote: post #38
monkpit wrote: post #3

The raises had to be approved though, right? It seems like an excuse to blame software for this. And it seems really off-putting that they wouldn’t just own the error, but instead try to revert it.

no such thing as "bank error in your favor" anymore i suppose

"Bank error in your favor", would mean bank screwed previously some money from you and now are returning it... So, not really in your favour...

Re: Amazon walking back raises after internal bug miscalculated compensation

#87

Post by ghaff »

hn_throwaway_99 wrote: post #45

Two things going on here: 1. First, I'm a bit baffled by some of the responses along the lines of "Amazon should just own their mistake". Sorry, but in the real world, "finders keepers" rarely applies (unless you're talking about crypto, but I digress...). I would certainly want a bug corrected if it were in my favor, and if a bug went the other way, I might need to re-evaluate my company satisfaction based on my new…

>basically have just come to expect that the equity portion of their compensation should be like cash.

Not just like cash. Like cash that may be worth 50% or more money by the time it vests.

Hopefully, it won't get that bad for large public companies but there are probably people out there today who are banking on their total comp being $400K (and making decisions on that basis) when it's actually more like $200K or less.

Re: Amazon walking back raises after internal bug miscalculated compensation

#88

Post by dnissley »

halfmatthalfcat wrote: post #54
turtlebits wrote: post #51

Earlier quoted context omitted.

I've never seen a $$ amount associated with RSUs on the offer letter, only the number of stock awarded. The recruiter may tentatively tell you how much they're currently worth to give you an estimated total comp.

I had $x of RSUs offered at signing at FAANG-esque company. A month after joining you were allocated x RSUs at the given stock price at that moment for the offered $ amount.

Yep, this is how it worked for me as well for my initial grant. However, my understanding is that yearly refreshers are often done as a set number of units.

Re: Amazon walking back raises after internal bug miscalculated compensation

#89

Post by imwillofficial »

staticautomatic wrote: post #66
alistairSH wrote: post #60

Earlier quoted context omitted.

a new hire at my current level would get literally double my current comp as a person at the company for five years That's not unusual. Well, 2x salary might be, but it's well established that job hopping is the only way to guarantee your salary stays close to market.

To add a data point to this, I recently interviewed at a large tech company. As part of investigating the comp, I ran a linear regression on data from levels and the results indicated that you should deduct a few grand for every year of tenure.

Levels is garbage data. How is this not obvious?

Re: Amazon walking back raises after internal bug miscalculated compensation

#90

Post by TimPC »

alistairSH wrote: post #19
ineedasername wrote: post #14

Earlier quoted context omitted.

Then that is a misunderstanding by the employee about how their compensation works. It’s little different than owning stock. I could say “I own $5000 in Amazon stock” but I still know it actually means I own $X shares while the dollar value is variable.

It depends how the comp statement is written. "Salary: $180k. RSUs: $80k (100 shares)" VS "Salary: $180k. RSUs: $80k" With the former, I can easily spot check the share price and make sure it's correct. With the latter, I cannot, and take it at face value.

They have to write the latter because at the time of the offer letter the share price on the conversion date is not known. If you get hired on September 1st and the first board meeting after is September 19th, your RSUs will get converted to shares on September 19th at the September 19th price. If your offer letter is written August 1st, there is no way to include the correct number of shares.
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