Your compensation can fluctuate based on what Janet Yellen says in a speech.
I agree with your premise, but don't give too much credit to "the high level management". Most of them are groping in the dark.
My initial offer from Google was $150k base, ~15% holiday bonus, and came with >$100k in stock vesting over four years, and they give another four-year stock grant each year. I have 7 years of industry experience and I interview well.
Unless you get that kind of equity yearly—which is crazy, and brings up dilution questions—you're better off taking a higher salary and investing as much as possible.
But—adding X market value for equity vesting over Y years with 40% capital gains tax for the first 12 months of holding it leads to a 2016 pay of.... just your salary.
Oh, and you get equity every else in addition to that nice pay, and they don't strap your pager to your face.
At my annual review last year I received more stock along with a pay increase. So, thus far, yes.
>>But—adding X market value for equity vesting over Y years with 40% capital gains tax for the first 12 months of holding it leads to a 2016 pay of.... just your salary.
Can you elaborate on this? I'm not following.
>>Oh, and you get equity every else in addition to that nice pay, and they don't strap your pager to your face.
What do you suggest I do?
Unless you do spectacularly poorly, you can expect that to continue
Well, if you do get more stock it complicates things—but you have to distribute out the pay out over the vesting period. In other words, collecting the entire value of the equity into one pay period implies you'll get the same amount of money the next pay period—which is only true if you get that amount of equity annually. It sounds like this may be a possibility
Furthermore, it assumes you'll be at the company for the entire vesting period. Which you might not want to do.
Additionally, you can't cash out the equity you DO get in 2016 unless you want the government to take a sweet 40% off the top.
> What do you suggest I do?
Don't wait for the equity to vest fully, work hard for some good recommendations, and get out of that sweat shop. Amazon rewards ambitious workaholics. Everyone I've talked to who USED to work there (key point being these people left) has issues balancing work, pay, and a life.
To be clear—I'm not arguing anything but that other companies will use you a little more compassionately, and you might make a little more cash in the meantime. You're still doing very well for yourself, Amazon is far from the worst place to work, and you might be very happy there.
The annual and midyear review process takes this into account and attempts equalize total compensation depending on the value of the stock (basically, you want the stock to be down when the price is used to calculate your total comp at the end of January).
When I was there, it was somewhat difficult to recruit some higher level roles because they might only be offered $120-$150K salary and then 200 or so RSUs over the course of the first year. That doesn't always look as enticing to someone as $250K salary.
I ended up not accepting that offer because another company gave me a more interesting role. Also their stock vesting schedule is horrible (most of the money comes in year 4), and many people find amazon to be soul-sucking. You're likely to leave at the 2 year mark, thus losing out on most of the stock anyways. 4 years is a long time to be at Amazon (though if you're the right mix of "in-it-to-win-it" and "workaholic" you might thrive there)
Do they give you the stock as a bonus at the end of the year, or are you promised it at the beginning and it gets doled out during the year? If it's the former, be careful that they don't decide retroactively that you had a bad year and decide to cut your total compensation almost in half!
5% the first year
15% the second year
20% every six months thereafter
Compensation at Amazon typically is a combination of a base salary, a signing bonus (distributed over time), and a stock grant. The package is structured in such a way that the employee's total pay stays consistent over time, even though the pay comes in different forms. New hires will have their signing bonus structured over the first two years, and then it ends. At that point, the more significant stock vests begin to occur at six month intervals, so the total pay amount stays relatively the same after the bonus ends.
The standard (at GOOG & others) is:
25% on year 1 2.08 & 1/3rd every month thereafter (75% vested equally over the next 36 months)
Furthermore, there are other grants that vest quarterly for the first 18 months of employment (in addition to the normal 4 year).
Look, I used to work at Amazon. They are the worst paying big company out there. Complete with totally shitty vesting plans. My first vesting with Amazon was over 5 years. Yup, they really took advantage of us new grads.
Anybody earning 6 figures is in the top few percentiles of society, especially if you are a new grad!
You are obviously free to take advantage of your employability but just remember that you pretty much are the 1% before saying that it sucks. :)
He is saying that Amazon's RSU vest schedule sucks compared to the standard used by Google and others. His income level has nothing to do with anything about that.
Fair enough I guess, but I am not a fan.
In the real world (outside FaceGoogAmaWallstreet), the story for developers is quite different.
Keep in mind also that Amazon is not some tiny startup strapped for cash. It's a big player in the industry and their hiring standards are rigorous.
"Underpaid" and "overpaid" are relative terms. If you currently earn less than what you can expect to receive elsewhere for the same work, you are underpaid.
>>In the real world (outside FaceGoogAmaWallstreet), the story for developers is quite different.
Interestingly enough, this is precisely the sort of thing that this very thread is attempting to challenge. Have you noticed how many "wow I am seriously underpaid" comments have been posted?
All of this reminds me of a quote by Michael Corleone in The Godfather:
Never be embarrassed by your wealth. This recent contempt for money is still another trick of the rich to keep the poor without it.
This package would be underpaid for pretty much any pure tech company on a coast.
It's not just the big few who pay really well. There are whole constellations of medium to small software companies you've never heard of that pay very well. The differentiator is that they see software as a strategic asset, not just a cost of doing business.