4 ms·

Company stock is basically ownership, and there's a dollar value attached to it. So is does Zynga's request run into the practice of extortion? It's another w

Company stock is basically ownership, and there's a dollar value attached to it. So is does Zynga's request run into the practice of extortion? It's another way of saying, give us your money or else something bad will happen.

tghw 15y ago
Not quite, since it's unvested shares they're taking back. The company has promised to give those shares to the employees when they hit certain tenure milestones, but the company still owns them in the meantime. If they fire the employee, the company keeps those shares.
- davorak 15y ago
  The fact that it is unvested shares changes little. The employees where lead to believe that if they meant a certain milestones they would receive stock. Now the milestones have been changed. The employees must now also meet new criteria for productivity to receive stock. They signed up for one deal and are now being served another.
  - hugh3 15y ago
    Except the possibility always existed that they could get fired and not get that stock. The only thing that has changed is that Zynga is now saying that they're willing to fire you just so you don't get that stock. Deeply unethical, and terrible for employee relations, and not at all in the interests of the company, but probably legal.
    - rayiner 15y ago
      Even in right to work states, there's all sorts of reasons a company can't fire you, it's just the burden is on you to prove them. Pedagogical example is that your boss can't fire you just because you wouldn't sleep with him. If they fire you claiming it was just for performance, but you have evidence of circumstances that makes it clear it was because you wouldn't sleep with him, then you've got a problem. Firing someone to screw them out of contractual rights you both agreed to is problematic. And even if the company claims it was performance-based, which they will have to, the CEO's statements basically give the other side all the evidence they need to refute that.
- shad0wfax 15y ago
  This is extortion of sorts right? I mean, yes they could fire the employee for genuine reasons, but if there is a way to prove that the conversation did occur, where the execs did tell the employee to return the unvested stocks in order to keep the job, its pure blackmailing. I wish there was someway to expose these crooks and bring them to justice.
skmurphy 15y ago
CA law provides for at will employment but if the original option was not contingent on specific performance beyond what is needed to continue as an employee, and they are willing for the employee to continue working there provided they surrender their stock they may be in more of a gray area. It's in the nature of a targeted pay cut but it doesn't seem to involve a demotion or change in position, they are effectively approach certain employees and telling them, "we are paying you too much, accept a reduction in your total compensation or we will terminate you."
- nobody3141592 15y ago
  Doesn't matter if it's unvested stock. They simply fire you without cause the day before your stock vests. All they are saying is - give back the stock and we won't fire you the day before it vests.
  - nobody3141592 15y ago
    Although legally they might be safer firing everyone and re-hiring them post IPO. Although I would hate to work with anyone that they got to agree with this!
- davorak 15y ago
  I would agree with the analogy if the stock compensation was payed out along the way. I think it is more akin to "we are not satisfied with your work on the contract we are taking what you have produce so far and are only going to pay you a portion of the original agreed upon amount."
  - skmurphy 15y ago
    In effect it is paid out along the way, that's the effect of the vesting schedule (whether it's options vesting or buyback rights terminating each month).
- danssig 15y ago
  Wrong. They're saying "I know I gave you this, and put a lock in so you had to stay, but now it's worth more than I think you deserve so I'm going back on my agreement. Sorry you worked here so long for below market wages".

tghw 15y ago

Not quite, since it's unvested shares they're taking back. The company has promised to give those shares to the employees when they hit certain tenure milestones, but the company still owns them in the meantime. If they fire the employee, the company keeps those shares.

davorak 15y ago
The fact that it is unvested shares changes little. The employees where lead to believe that if they meant a certain milestones they would receive stock. Now the milestones have been changed. The employees must now also meet new criteria for productivity to receive stock. They signed up for one deal and are now being served another.
- hugh3 15y ago
  Except the possibility always existed that they could get fired and not get that stock. The only thing that has changed is that Zynga is now saying that they're willing to fire you just so you don't get that stock. Deeply unethical, and terrible for employee relations, and not at all in the interests of the company, but probably legal.
  - rayiner 15y ago
    Even in right to work states, there's all sorts of reasons a company can't fire you, it's just the burden is on you to prove them. Pedagogical example is that your boss can't fire you just because you wouldn't sleep with him. If they fire you claiming it was just for performance, but you have evidence of circumstances that makes it clear it was because you wouldn't sleep with him, then you've got a problem. Firing someone to screw them out of contractual rights you both agreed to is problematic. And even if the company claims it was performance-based, which they will have to, the CEO's statements basically give the other side all the evidence they need to refute that.
shad0wfax 15y ago
This is extortion of sorts right? I mean, yes they could fire the employee for genuine reasons, but if there is a way to prove that the conversation did occur, where the execs did tell the employee to return the unvested stocks in order to keep the job, its pure blackmailing. I wish there was someway to expose these crooks and bring them to justice.

skmurphy 15y ago

CA law provides for at will employment but if the original option was not contingent on specific performance beyond what is needed to continue as an employee, and they are willing for the employee to continue working there provided they surrender their stock they may be in more of a gray area. It's in the nature of a targeted pay cut but it doesn't seem to involve a demotion or change in position, they are effectively approach certain employees and telling them, "we are paying you too much, accept a reduction in your total compensation or we will terminate you."

nobody3141592 15y ago
Doesn't matter if it's unvested stock. They simply fire you without cause the day before your stock vests. All they are saying is - give back the stock and we won't fire you the day before it vests.
- nobody3141592 15y ago
  Although legally they might be safer firing everyone and re-hiring them post IPO. Although I would hate to work with anyone that they got to agree with this!
davorak 15y ago
I would agree with the analogy if the stock compensation was payed out along the way. I think it is more akin to "we are not satisfied with your work on the contract we are taking what you have produce so far and are only going to pay you a portion of the original agreed upon amount."
- skmurphy 15y ago
  In effect it is paid out along the way, that's the effect of the vesting schedule (whether it's options vesting or buyback rights terminating each month).
danssig 15y ago
Wrong. They're saying "I know I gave you this, and put a lock in so you had to stay, but now it's worth more than I think you deserve so I'm going back on my agreement. Sorry you worked here so long for below market wages".