February 14, 2022
Tech Giants Adjust Stock Grant Practices to Retain Employees
This Forbes article from Bruce Brumberg – Editor-in-Chief & Co-Founder of MyStockOptions.com – notes that some big tech companies are changing their stock grant practices to stay attractive in the midst of the Great Resignation. Here are some of the examples he cites:
– Amazon – raising the cap on employee base pay, making stock grants when employees are promoted instead of waiting until the next annual grant cycle, considering a shift to monthly vesting (from backend-loaded), and allowing longer leaves of absence before pausing RSU vesting (and vesting will now continue during parental and medical leave).
– Apple – high-performers receiving out-of-cycle RSU grants as a retention incentive (which didn’t go over well with everyone), CEO received a new performance-based RSU grant on his 10-year anniversary based on TSR.
– Alphabet – four senior execs received new stock awards that were split between time-based and performance-based RSUs, shift to front-loaded vesting for employee RSU grants.
Bruce predicts that more companies will be examining vesting schedules and possibly making them more favorable to employees and executives. He also points out that concerns are resurfacing about underwater stock options and reduced value of previously granted RSUs. Companies may be beefing up new grants to make up for that.
– Liz Dunshee