No bump after promotion?
Met a friend today that told me that he went from L6 to L7 at Amazon, but his TC actually dropped. He said that the bump in his base pay and the stock upgrades weren’t enough to compensate for the fall in the number of vesting stocks between the year before and the year he was promoted. How is this possible ? Non tech role #amazon #promotion #tc
Just happened to me at a bank 😢 On the plus side, I won’t get layoff, at least not this year.
Very normal at Amazon. Happened to my friend too going from SDE1 to 2 in the past.
Can you help understand why this happens ?
If he was hired during the pandemic spree - he was probably simply overpaid, and would have been laid off if he hadn't gotten promoted. Otherwise, your friend is probably comparing last year's PCS statement (future estimated TC) with a new forward looking estimate after the promotion. I would guess base went up a little and his number of vested stocks went up, but Amazon's share price is lagging behind the growth estimated in the last PCS. That's the thing - Amazon PCS always says "here's what you will be making next year (quiet) assuming the stock goes up XX%".
But you can play around with the PCS and set it to zero percent increase right ?
If your cliff gives you more reduction but you get 💩 raise due to promo as you're already earning top of uour band
pay works by bands. Some ppl get out of band offer upon joining. But after the new hire package ends, future pay will be in band. Pretty standard everywhere. Stock growth can cause cliffs too but that means it’s a good thing. You are too stuck on the delta from year to year. In these cases a drop just means outsize pay previously. If no promo then cliff would’ve been steeper.
Let's say your TC is x base +y stock. Typically the y is significantly high because 4th year is 40% of joining stock offer. Candidates got promotion in 5th year and his base went from L6 range(assume highest of band) to L7 entry (typically hv1 level) which could be x + 10 or so but new stock will not match y so total will be lower than year 4 earning. Candidate is better placed in comparison to other candidates who don't get promotion.
yeah they might have a cliff, but should be at least the same numbers.
Can you help understand the concept of a cliff with an example ?
A simple example: pretend your new hire grant vests 25% per year. In the 5th year you get zero stock from that grant so even if your base pay goes up your total compensation goes down.