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Given that most big tech companies' base salary tends to plateau and total comp begins to be dominated by stock grants and performance bonuses, just how much re

by ENOTTY 4y ago

Given that most big tech companies' base salary tends to plateau and total comp begins to be dominated by stock grants and performance bonuses, just how much real transparency is actually going to be provided?

deleted 4y ago
[deleted]
InefficientRed 4y ago
Agreed 100%. At big tech salary is close to useless and rarely the primary number that changes during negotiations. My highest paying job -- a 3.5x raise -- came with a $75K salary cut compared to my previous job. This should be, by far, the top voted comment. I don't think MSFT sharing salary ranges is consequential in any way.
- JamesSwift 4y ago
  Sure it is. If more start to do it, it becomes an arms race. If a company is loading the compensation in other ways and coming in light on salary then their job posting becomes much less compelling for job seekers. So they have a choice: disclose the other compensation (in order to compete with the salary numbers of the other companies) or adjust their compensation to be heavier on salary so their numbers are in line with others.
  - sokoloff 4y ago
    For the longest time, Amazon's cash salary cap was well-known to be in the middle $150K range. I don't see any evidence that hampered their ability to attract job seekers.
  - bluGill 4y ago
    That depends on what the other things are. Most years I get half of my take home pay in December because of my bonus (some of that is my 401k maxing out in November), there have been a couple bad years where the bonus was less, but at least I was able to keep my job. Keeping my job is a factor as well, since I have a family to support, if I'm laid off (like most companies do all the time) that means I'm scrambling to figure out how to get cash, while I can live off of the smaller paychecks I get. That is me - what is the above worth to you? If you are risk adverse like me, then you like that plan. Others want the cash now but can accept the risk of losing their jobs. Some have a high risk tolerance and like getting their money in stocks - in the best case this is the most money, but in the worst case it is the least. There is no right answer. In the end you need a certain amount of money to live. That is different from your actual value.
    - r00fus 4y ago
      This would be included in total compensation (which should include non-renumerative benefits as well). In sales, where total comp could be mostly commission (I've seen a 25/75% split in some cases) the company should have some idea of what the bonus/commission range is.
    - tshaddox 4y ago
      Out of curiosity, why does your 401k max out in November? If your employee does matching then wouldn’t you want to spread it as evenly as possible throughout the entire year?
      - InefficientRed 4y ago
        November is pretty close to the whole year. If you choose a fixed % per paycheck and have a bonus that's not perfectly amortized then being off by a month is actually pretty good.
        tshaddox 4y ago
        I assumed that employer contribution matching is generally a fixed percentage of the employee’s salary each pay period, which means that if you don’t contribute in one month you forfeit that percentage of your salary and thus about 8% of your total possible employer matching.
        endianswap 4y ago
        At least in my case as an engineer at a smaller tech company my 401k (and corresponding match) maxes out each January because that's when bonuses are granted.
        InefficientRed 4y ago
        Note: you can set your contribution % to 0 in January and then change it in February. This can be worthwhile because you then DCA throughout the rest of the year. On the other hand, by contributing everything in January, you get the employer match earlier. And over a 30 year career it's likely a rounding error.
  - Solstinox 4y ago
    Arms race (which will lead to bigger salaries) or price collusion (salaries stay the same)?
    - rsanek 4y ago
      Wouldn't be the first time https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...
    - JamesSwift 4y ago
      I think its more likely to be an arms race now that the "remote work" dam has broken and work location is not as important as during the time of the previous well-known collusions.
  - com2kid 4y ago
    I'm sad more companies don't up their 401k contributions, most people don't realize their employer can put in 40k a year (!!!) into an employee's 401k. Due to the wonders of tax law, that is equiv to 60k cash, and that isn't counting the earnings or the flexibility to reallocate 401k investments w/o having to pay taxes on earnings when changing where the money is invested.
    - tshaddox 4y ago
      > Due to the wonders of tax law, that is equiv to 60k cash And equivalent to 0 cash for paying the rent. I suspect that’s why it doesn’t seem to be a prominent concern in discussions about tech compensation.
      - afrodc_ 4y ago
        I don't know about you, but with tech salaries, rent is the least for my concern. I think that's true for most people that don't live in ridiculously high cost of living areas.
        tshaddox 4y ago
        Perhaps, although until COVID (and we'll see what happens with remote work compensation in the long term) nearly all people with huge big tech compensation packages lived in ridiculously high cost of living areas. I suspect a very large portion still do. In the Bay Area I've heard no shortage of stories of couples/families with two big tech salaries still spending very large portions of their paychecks on rent/mortgage.
      - deelowe 4y ago
        BS. There's nothing stopping you from maxing your 401k and then pulling it back out taking the penalty. This applies to a ton of benefits people naively don't take advantage of from HSAs to employee stock purchase plans to 401k. It's almost always beneficial to maximize your tax advantaged accounts even if you're paying penalties on the back end.
    - nfriedly 4y ago
wing-_-nuts 4y ago
Yeah without TC this isn't really all that useful.
llbeansandrice 4y ago
More people work for Microsoft than just engineers. This applies to all of their US job postings. Just because you specifically don't get much benefit doesn't mean it's not a good thing.
r00fus 4y ago
The side effects of this move are probably bigger than the move itself. Hopefully this induces other companies to advertise their salary ranges as candidates (it's still a candidate's market out there) use Microsoft's ranges as reference for negotiating salaries on other non-MS jobs. Essentially this will push salaries up to match the massive inflation we've seen recently. Likely this will result in a homeostasis at some future point.
gigel82 4y ago
Not for Microsoft though; their stock grants are :peanut_emoji: compared with other top tier companies (Source: levels.fyi); so this probably a good thing overall... EDIT: just found out HackerNews is stripping out unicode emoji characters from comments.

by ENOTTY 4y ago

deleted 4y ago

[deleted]

InefficientRed 4y ago

Agreed 100%. At big tech salary is close to useless and rarely the primary number that changes during negotiations. My highest paying job -- a 3.5x raise -- came with a $75K salary cut compared to my previous job. This should be, by far, the top voted comment. I don't think MSFT sharing salary ranges is consequential in any way.

JamesSwift 4y ago
Sure it is. If more start to do it, it becomes an arms race. If a company is loading the compensation in other ways and coming in light on salary then their job posting becomes much less compelling for job seekers. So they have a choice: disclose the other compensation (in order to compete with the salary numbers of the other companies) or adjust their compensation to be heavier on salary so their numbers are in line with others.
- sokoloff 4y ago
  For the longest time, Amazon's cash salary cap was well-known to be in the middle $150K range. I don't see any evidence that hampered their ability to attract job seekers.
- bluGill 4y ago
  That depends on what the other things are. Most years I get half of my take home pay in December because of my bonus (some of that is my 401k maxing out in November), there have been a couple bad years where the bonus was less, but at least I was able to keep my job. Keeping my job is a factor as well, since I have a family to support, if I'm laid off (like most companies do all the time) that means I'm scrambling to figure out how to get cash, while I can live off of the smaller paychecks I get. That is me - what is the above worth to you? If you are risk adverse like me, then you like that plan. Others want the cash now but can accept the risk of losing their jobs. Some have a high risk tolerance and like getting their money in stocks - in the best case this is the most money, but in the worst case it is the least. There is no right answer. In the end you need a certain amount of money to live. That is different from your actual value.
  - r00fus 4y ago
    This would be included in total compensation (which should include non-renumerative benefits as well). In sales, where total comp could be mostly commission (I've seen a 25/75% split in some cases) the company should have some idea of what the bonus/commission range is.
  - tshaddox 4y ago
    Out of curiosity, why does your 401k max out in November? If your employee does matching then wouldn’t you want to spread it as evenly as possible throughout the entire year?
    - InefficientRed 4y ago
      November is pretty close to the whole year. If you choose a fixed % per paycheck and have a bonus that's not perfectly amortized then being off by a month is actually pretty good.
      - tshaddox 4y ago
        I assumed that employer contribution matching is generally a fixed percentage of the employee’s salary each pay period, which means that if you don’t contribute in one month you forfeit that percentage of your salary and thus about 8% of your total possible employer matching.
        endianswap 4y ago
        At least in my case as an engineer at a smaller tech company my 401k (and corresponding match) maxes out each January because that's when bonuses are granted.
        InefficientRed 4y ago
        Note: you can set your contribution % to 0 in January and then change it in February. This can be worthwhile because you then DCA throughout the rest of the year. On the other hand, by contributing everything in January, you get the employer match earlier. And over a 30 year career it's likely a rounding error.
- Solstinox 4y ago
  Arms race (which will lead to bigger salaries) or price collusion (salaries stay the same)?
  - rsanek 4y ago
    Wouldn't be the first time https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...
  - JamesSwift 4y ago
    I think its more likely to be an arms race now that the "remote work" dam has broken and work location is not as important as during the time of the previous well-known collusions.
- com2kid 4y ago
  I'm sad more companies don't up their 401k contributions, most people don't realize their employer can put in 40k a year (!!!) into an employee's 401k. Due to the wonders of tax law, that is equiv to 60k cash, and that isn't counting the earnings or the flexibility to reallocate 401k investments w/o having to pay taxes on earnings when changing where the money is invested.
  - tshaddox 4y ago
    > Due to the wonders of tax law, that is equiv to 60k cash And equivalent to 0 cash for paying the rent. I suspect that’s why it doesn’t seem to be a prominent concern in discussions about tech compensation.
    - afrodc_ 4y ago
      I don't know about you, but with tech salaries, rent is the least for my concern. I think that's true for most people that don't live in ridiculously high cost of living areas.
      - tshaddox 4y ago
        Perhaps, although until COVID (and we'll see what happens with remote work compensation in the long term) nearly all people with huge big tech compensation packages lived in ridiculously high cost of living areas. I suspect a very large portion still do. In the Bay Area I've heard no shortage of stories of couples/families with two big tech salaries still spending very large portions of their paychecks on rent/mortgage.
    - deelowe 4y ago
      BS. There's nothing stopping you from maxing your 401k and then pulling it back out taking the penalty. This applies to a ton of benefits people naively don't take advantage of from HSAs to employee stock purchase plans to 401k. It's almost always beneficial to maximize your tax advantaged accounts even if you're paying penalties on the back end.
  - nfriedly 4y ago

wing-_-nuts 4y ago

Yeah without TC this isn't really all that useful.

llbeansandrice 4y ago

More people work for Microsoft than just engineers. This applies to all of their US job postings. Just because you specifically don't get much benefit doesn't mean it's not a good thing.

r00fus 4y ago

The side effects of this move are probably bigger than the move itself. Hopefully this induces other companies to advertise their salary ranges as candidates (it's still a candidate's market out there) use Microsoft's ranges as reference for negotiating salaries on other non-MS jobs. Essentially this will push salaries up to match the massive inflation we've seen recently. Likely this will result in a homeostasis at some future point.

gigel82 4y ago

Not for Microsoft though; their stock grants are :peanut_emoji: compared with other top tier companies (Source: levels.fyi); so this probably a good thing overall... EDIT: just found out HackerNews is stripping out unicode emoji characters from comments.