Amazon’s senior managers and different senior leaders received’t obtain money pay raises this yr, Fortune has discovered, eliminating a key reward for high staff on the on-line retailing large.
A few of these staff could obtain extra firm inventory, however that’s not assured.
Amazon compensation workers have began notifying some leaders in regards to the modifications and explaining this yr’s coverage.
The transfer applies to staff whose roles are categorised internally as Stage 6 or increased, which is kind of center administration and above. However Stage 6 roles additionally embrace some particular person contributors, reminiscent of senior software program engineers. The compensation replace applies to all staff at these ranges, whether or not they’re in workplace desk jobs or in managerial roles inside Amazon amenities reminiscent of achievement facilities.
Traditionally, whole compensation packages for a lot of Amazon company staff consist of a bigger ratio of inventory compensation than at different tech corporations. As such, Amazon spokesperson Margaret Callahan made clear in a press release the corporate’s perception that senior Amazon staff have already benefited vastly from Amazon’s share value improve of round 80% over the previous 12 months.
“Amazon’s compensation philosophy emphasizes possession, which signifies that a portion of worker compensation consists of RSUs,” Callahan stated within the assertion to Fortune. “The extra senior you’re within the firm, the extra your compensation consists of RSUs than money base pay. Because of the progress in Amazon’s inventory value over the previous yr (roughly 77%), many staff’ compensation will meaningfully exceed the quantity that the corporate deliberate for them to earn once we set compensation final yr and in prior years’ compensation cycles. In consequence, for this yr’s compensation cycle, we’re prioritizing money base pay will increase for workers whose compensation is weighted extra closely in base pay versus inventory.”
Translation: The extra senior you’re, the decrease chance that you will notice a money fee. Some Stage 6+ staff may nonetheless see a money base improve in the event that they had been not too long ago promoted or moved laterally into a totally new function. There’s a probability that some staff at Stage 6 or above will obtain extra restricted inventory models, or RSUs, this yr, however that’s not assured. For these Stage 6 and Stage 7 staff who do obtain new RSUs, they are going to vest quarterly like they do for Stage 8 staff and above, fairly than simply twice a yr.
The compensation replace comes as Amazon leaders below CEO Andy Jassy proceed to search for methods to trim pointless prices and improve profitability, whereas investing in progress areas reminiscent of generative AI. On Wednesday, Amazon introduced a brand new $2.75 billion funding within the AI firm Anthropic, including to an earlier $1.25 billion funding within the firm.
Over the past couple of years, Amazon below CEO Andy Jassy has laid off greater than 27,000 company staff whereas he focuses on investing in fewer, greater bets. Amazon generated the biggest quarterly working revenue in its historical past—$13.2 billion—within the fourth quarter of 2023.
Are you an Amazon worker with ideas on this subject or a tip to share? Contact Jason Del Rey at jason.delrey@fortune.com, jasondelrey@protonmail.com, or via safe messaging app Sign at 917-655-4267. It’s also possible to message him on LinkedIn or at @delrey on X.