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Not Amazon, but when I receive RSUs it is denominated in the dollar amount. In a year when the first part vests the dollars are converted to stock units based o

by Scea91 4y ago

Not Amazon, but when I receive RSUs it is denominated in the dollar amount. In a year when the first part vests the dollars are converted to stock units based on the price at that moment. Thus I do not know how many units of stock I am receiving until the first vesting event, because I don't know what the price will be in a year.

s1artibartfast 4y ago
That makes no sense at all. Why not just give you cash with an X year delay.
- Scea91 4y ago
  I have 4 year vesting period. After the first vest the following vests start to be denominated in stock units. I think the advantage for company is somewhat better predictability?
  - deleted 4y ago
    [deleted]
crazygringo 4y ago
That... is truly bizarre. I've literally never heard of that before. The entire point of RSU's (or stock options) is that if the company increases in value over time, e.g. over your first year, so does the cash value of your RSU's. That employees benefit as the company benefits. What you're describing is zero benefit at all. It's no different from just being granted cash that vests. It's such a strange and seemingly pointless thing to do, that I have to ask -- are you sure that's how it works? And if so, has someone from the company ever explained why they do that?
zwily 4y ago
That sounds absolutely bizarre. Why do stock the first year at all? I have never heard of anyone trying that before. edit: That setup is basically saying "you don't benefit from the increase in share value for the first year of employement", which is pretty employee-hostile. I bet a company that was doing this before stopped doing it this year, when their stock value fell by a lot. :)
- ineedasername 4y ago
  I've not heard that either, but maybe they do it because it's cheaper? Stock reserved for RSU grants doesn't cost companies cash in the same way that a direct monetary bonus would.
conductr 4y ago
You've not been incentivized to increase the stock price, this is poorly designed and only serves to keep you locked in

by Scea91 4y ago

s1artibartfast 4y ago

That makes no sense at all. Why not just give you cash with an X year delay.

Scea91 4y ago
I have 4 year vesting period. After the first vest the following vests start to be denominated in stock units. I think the advantage for company is somewhat better predictability?
- deleted 4y ago
  [deleted]

crazygringo 4y ago

That... is truly bizarre. I've literally never heard of that before. The entire point of RSU's (or stock options) is that if the company increases in value over time, e.g. over your first year, so does the cash value of your RSU's. That employees benefit as the company benefits. What you're describing is zero benefit at all. It's no different from just being granted cash that vests. It's such a strange and seemingly pointless thing to do, that I have to ask -- are you sure that's how it works? And if so, has someone from the company ever explained why they do that?

zwily 4y ago

That sounds absolutely bizarre. Why do stock the first year at all? I have never heard of anyone trying that before. edit: That setup is basically saying "you don't benefit from the increase in share value for the first year of employement", which is pretty employee-hostile. I bet a company that was doing this before stopped doing it this year, when their stock value fell by a lot. :)

ineedasername 4y ago
I've not heard that either, but maybe they do it because it's cheaper? Stock reserved for RSU grants doesn't cost companies cash in the same way that a direct monetary bonus would.

conductr 4y ago

You've not been incentivized to increase the stock price, this is poorly designed and only serves to keep you locked in