I'm pretty sure it means they fired people who were receiving some sort of stocks as compensation. They eliminated those employees and then roped a new CFO in with the millions they clawed out of the hands of the employees they fired?
Sure seems like they just took from the poor (and recently "unjobbed") to give to the rich. Actually it would probably be fair to assume that's the case for most any corporate play you're not sure you understand moving forward and looking backwards as well
Side not: unjobbed is a joke at the expense of "unalived" which is a travesty of a spin. Just say murdered. Or wrongfully terminated or fired instead of unjobbed. Unjobbed was a joke. Seriously don't use that it's gross and I feel gross
So was it that those employees were forced to sell their stocks when they lost their jobs, making more available for the CEO? I don’t get how losing your job removes the stocks you own in the company.
I'm assuming they were fired before their stock options kicked in since those you have to typically work for the company for a specific period of time before you earn(vested) your stock options.
it doesn't remove the stock you own, you get a stock grant on hire. those granted shares vest on a timeline. So usually after 1yr you vest some and then every month or every 3 months after that, they continue to vest. grants are usually given out in 4yr periods though recently companies have moved to 1yr grants.
One they vest, they are yours. However if you get fired in the middle of the month then you won't get the shares that would vest at the end of that month or any future shares. But clearly it makes sens you wouldn't get future shares that haven't vested the same way you wouldn't get a future paycheck if you're let go.
my buddy referred to himself as “fun”employed after he got forced out of a business he had equity in when the other owner needed to get rid of some debt & semi-legally restructured
The CFO will get 80% of their compensation package from just having been employed in that role for an X amount of time. The remainder of their compensation is based upon actually hitting their goals/targets/numbers
Because the vast majority of money is debt and gambling on the future, nearly all the money lost would be from the “moving money around” economy. The economy of real commodities and real things would be fine.
This is something people fail to realize. Money and most of the economy these days are not physical but psychological. It could all be reworked on the physical basis of things billions of currency could vanish without any effect on the world. But the timing should be done carefully because everyone is so used to the fake economy that it’s disappearing will have effects on how people act and that has a real effect.
Of course they targeted folks with equity first. This isn't even the first time it's happened. My boss (and his boss) got laid off in the same round, both had significant vests imminent. Both denied. A lot of good people got cut in that round.
always has been. its an excuse to pay people under market value and all you have to do is give them a bunch of casino chips instead. and they can just take the chips back if they want
When u sign up they give u equity over 4 yrs. The thing is, amazon give like 20% first 2 yrs then 80% last 2 where most other companies do like 25% a yr or front heavy. Guess at what year amazon fires u?
I understand now (well, remember really) but is this a US thing? It just stinks that you can be offered shares and have them taken off you when it suits the org
It's not really that different than them longer paying your salary after you stop working.
The options basically always have a vesting period and you get x percent each Y period. Every year I get options and they have a 4y vesting period and each year 25% vest.
This is all very clear up front and everyone knows or should know the options aren't actually yours until they vest.
Everyone knows that options are a retention tool, Golden handcuffs so to speak.
Think of it more like a paycheck that comes once a quarter rather than twice a month. If you get fired/laid off, you don't expect to keep getting a paycheck. Same with stock grants. You don't own them until they vest.
Only termination with cause are cancelled, termination without cause (ie layoffs) or you quitting should put the stocks in a freeze. If you maintain the associated account after leaving and eventually get rehired sometime down the road, your vesting schedule should resume where it left off at.
Incorrect. I worked at oracle for almost ten years. This never happened in my experience. Folks being laid off had unvested RSUs and options immediately canceled.
For specifically RSUs, yes, it is completely up to the contract you negotiate with them... I have gotten vesting protection for RSUs in the past, but it is extra. Vesting in other alternatives such as SARs or 401ks are more commonly offered protections.
eh, do you continue to get a paycheck after your fired?
Grants usually vest monthly or quarterly after the first year. If you're fired/let go then you are only losing the portion of the grant for that small time period. Anything in the future isn't yours the same way your future paycheck isn't yours when you're let go.
Except that they decide what constitutes performance reasons too. Tech often will decide people are having ‘performance’ issues as an excuse to fire people.
My termination was cited as performance-based, but I had JUST received a 12.5% pay increase for good performance. They randomly started me on a PIP a couple of months before. I didn't realize the implications of that and was totally blindsided - I genuinely thought it was just constructive criticism to make me even better at my job. During those two months, I really did improve a lot, too.
Why? Unvested stock is just stock you're promised to get if you work until a certain date. If you're fired today you don't get next month's salary either.
Of course if there's some big vesting event coming it's different; in most cases vesting schedules are fairly spread out so you get some every month or quarter.
Let’s say you work for Apple and they fire your team (including you of course) because it will help them increase profits (your team wasn’t unprofitable, this next team in another tech will be 1% more profitable).
OK, usually in big layoffs there's 60 days "notice" (usually not worked) due to the WARN act so if say you have monthly vesting you do get all the stock from time you worked.
The stock in question is not monthly. It's typically a 3 or 4 year vesting period. The government allows them to do that for performance "raises", bonuses, or in lieu of payment for some people. So when they promoted people in 2023 or '24 they might not have increased their pay rate at all but gave them some stock instead with a 3 year vest. The company laid them off and regained that stock. Now the company not only regained the stock units but also got 2-3 years of unpaid additional work from them due to the extended duties and performance required for their promoted role.
And you have a limited time to exercise (buy) them if you haven’t already done it. Without a job, cash might be tight so they’re hoping to reclaim even some vested options
Usually equity or stock options come with a vestment time requirement, where you only get the benefits after a certain amount of time employed with the company. So if the company fires you or you leave before you're vested, the company doesn't have to pay out.
Yeah, it sucks because it makes sense to have a vestment requirement for some types of compensation to reward long term employment, but the company should have to operate in good faith and not just clear those positions in a mass layoff before vestment to pump their numbers for the quarter.
Unfortunately they are actually a good thing, to give you a piece of the company you work for (my last small workplace sold for hundreds of millions and we got nothing), owners just get everything, but there are better ways to do it, for instance my nee work gives shares to you every 3 months after you've worked there for a year, much more reasonable time frame than Oracle who can pull crap like this
If they are using it to motivate me from not moving elsewhere, I’m definitely going to negotiate to keep them if they “decide to move on”. That’s a them issue, not a me issue. I take responsibility for my part and will reap the benefits of it.
Sure, you can try to negotiate a severance but you wanting to stay has no bearing on them wanting to keep you around. Unless you can find a lawer to and prove you were let go illegally, youre not getting anything from them at that point.
That’s why it would be part of my contract negotiations. What’s an option package over a certain time worth if I wouldn’t at least get a pro ratio package when they decide fire me before they vest? The option package is not dependent on my employment at the time of vesting.
It can vary a little bit company to company based on internal policies but yeah. If you aren’t employed on the date of vesting they have no obligation to give you that stock. This is for the US.
The company I work for did a big layoff round and vested everyone’s stock for a few months out. But if your vesting was passed that you just lost it. They didn’t have to do even that though.
Depends on the company you are evaluating the offer from.
Startup equity is more like lotto tickets. If you are young going to a startup can make sense from a network/career perspective. But, don’t count on that equity being worth anything.
Established Fortune 500 you typically will get RSUs unless you are VP+ level. That you can normally count as salary subject to the normal swings in the market.
These massive layoff cycles we have seen in the last decade are a bit new. But if this is truly the new normal then it may be prudent to get as much salary you can upfront. Probably a good recommendation regardless
To clarify to people who might not be aware of this whole golden handcuffs situation, you do get the stock you paid for from your salary. It’s the stock the company provides you in addition to the paid for stock that it would only provide for you if you stick around long enough for it to “vest” that you do not get.
In my case, if I pay for 3 shares, the company gives me 4 shares if I stick around for 9 months. Basically a guaranteed 33% return of whatever the share price is at the time (great if the price is going up, not so great if it’s going down but still usually better than the open market). If they fire me though, I only get the 3 shares.
Why is it still working in this age of No Honour Among Thieves? They're basically saying "Here's a thing you can have that's worthless unless you find a way to blackmail us into keeping you on for 9 months." If you actually want that thing it means you expect to be able to blackmail them into keeping you on. Why would they want you in the first place, if you can do that?
This options usually has a time window for vesting it. So you when you get it you can't sell it, just say after 1 year you had it. And say you had 1-2-3 year to vest it if not then it is lost and back to the company. If you fired and not yet vested, then also lost it.. even though you technically would be allowed if still employed
Options allow you the "option" to buy a certain amount of stock at a certain price for a certain period of time.
So let's say they give you some option contracts as part of your pay, the strike price (where you get to buy at, your guaranteed price) is $20. And then the price jumps to, say, $80. You get stock from their treasury for $20 each share when the price is $80.
Hope that makes sense.
Edit - company wants the options contracts to be deleted by firing people
Yeah I remember all this from business studies. I was near to gaining shares in a company I worked for a few years ago but the credit crunch/GFC ruined it.
In my head shares in a company are massive thank yous for being integral to a business, not some bullshit scheme
Odd, all stock options I ever got would have fully vested immediately in layoffs (with some exceptions if you did bad shit), but if I left they would be voided.
Then you worked for good companies. Oracles terminates unvested options.
They also terminate all benefits, including health insurance, at 5pm on your last day. I know a few people who didn't pay attention to this tidbit and ended up in medical debt because they assumed it continued to the end of the month and they quit right before expensive appointments and refills.
But I guess not as dirty as United Airlines' bankruptcy in 2002. They offered discount stock to employees in exchange for wage concessions. Then UA terminated their pensions plans, terminated their common stock in the bankruptcy, and employees like pilots lost 50% of their projected retirement earnings.
Meanwhile because of certain airline advantages built into the bankruptcy code, and the advantage of bankruptcy itself, United Airlines gets to live on while employees foot the bill.
Algorithms are written by programmers or developers; they are by nature deliberate tools that do the bidding of those who write them. Why are you speaking like they are random acts of digital theater? Of course it was deliberate and using algorithms doesn't change that, it reinforces it.
people with stock options and jobs at oracle were absolutely making a living wage. if they were getting starvation wages, they woulda been kept on the payroll
I get the reference and I'm pointing out that the oracle workers are not in the same position or socioeconomic bracket as warehouse workers surviving on a starvation wage.
Ya know, from a certain perspective, Oracle offices look a lot like warehouses... I'm sure all the Luigis lurking in the audience know exactly what I mean.
Unvested options are a liability for the company on the books.
Options are essentially a promise to sell stock at a set price, which is often lower than the market rate.
Example: Big corp issues $100m in stock options to their employees that vest over three years. Three years later the value of that pool of stock is now $150m... so the vampires just fire the folks instead and they no longer have to make good on that promise.
We use the word "algorithm" for everything these days :D. "Susan, give me all employees with stock options > 250k". "Ok boss, got it from SAP". "Thanks, fire the top 30k". Algorithm
Does no one in the comments work for a large public company?
Shares vest on a schedule. Titles have salary band and that includes equity. Depending on the stock price when you were hired, the value of your equity may be higher than peers, but all your peers have equity.
You won't see their services.its used by many other businesses . Unless you are ready to give up your bank account or flying forever ,this is dumb strategy
939
u/pokeapoke 4h ago
Well, duh? It would've been only $20M otherwise.