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You don't have to be an executive. Anybody can get any kind of parachute they want... if they're valuable enough to the company and negotiate for it. If a com

You don't have to be an executive. Anybody can get any kind of parachute they want... if they're valuable enough to the company and negotiate for it. If a company wants you bad enough, they'll give you what you want... the trick is being that valuable. So just be really, really good at what you do.. or at least have a great reputation in your field, and you may have the leverage to negotiate yourself a sweet deal from the company lucky enough to hire you.

londons_explore 4y ago
But the parachute is when leaving. Why would the company not simply fire you and pay you the minimum severance package offered in your contract?
- beachy 4y ago
  You must always negotiate the parachute when joining (or perhaps, when staying) - when leaving it is too late.
  - perpetualpatzer 4y ago
    Stay bonuses [1] are probably the most common case. It's actually pretty common in a merger, especially one with a long period between announcement and integration, to hand out parachutes of various metals to key employees. If you're the CEO closing a deal where the buying party is overpaying by $15B, they really really don't want you to quit in the middle. If you're a rock star category manager, they still want you to stick around because you might get the job after in the combined entity, and even if you won't, who will they be able to hire to manage the category while they're doing the deal? [1] https://www.forbes.com/sites/lizryan/2015/03/28/what-is-a-stay-bonus-and-how-can-i-get-one/?sh=5d9ee8436cab https://www.forbes.com/sites/lizryan/2015/03/28/what-is-a-st...
ethbr0 4y ago
So golden parachutes, in the commonly used C* sense, are subtly different -- they're buying an orderly transition. And why would you need to buy an orderly transition? Because the outgoing person is likely to have (a) massive organizational authority during the transition, (b) legal ways to abuse that authority to screw the company over, & (c) political power within the company. The money is predicated on having a role with access to those three things, and it's a payment for not abusing them in a time when incentives not to abuse them are removed (because you're being fired). Not very relevant when you're fired on the spot and escorted out of the building, as apparently happened at Twitter, but very relevant in a more traditional (and slow) leadership change. And hence why it's a standard part of contracts for those roles.

londons_explore 4y ago

But the parachute is when leaving. Why would the company not simply fire you and pay you the minimum severance package offered in your contract?

beachy 4y ago
You must always negotiate the parachute when joining (or perhaps, when staying) - when leaving it is too late.
- perpetualpatzer 4y ago
  Stay bonuses [1] are probably the most common case. It's actually pretty common in a merger, especially one with a long period between announcement and integration, to hand out parachutes of various metals to key employees. If you're the CEO closing a deal where the buying party is overpaying by $15B, they really really don't want you to quit in the middle. If you're a rock star category manager, they still want you to stick around because you might get the job after in the combined entity, and even if you won't, who will they be able to hire to manage the category while they're doing the deal? [1] https://www.forbes.com/sites/lizryan/2015/03/28/what-is-a-stay-bonus-and-how-can-i-get-one/?sh=5d9ee8436cab https://www.forbes.com/sites/lizryan/2015/03/28/what-is-a-st...

ethbr0 4y ago

So golden parachutes, in the commonly used C* sense, are subtly different -- they're buying an orderly transition. And why would you need to buy an orderly transition? Because the outgoing person is likely to have (a) massive organizational authority during the transition, (b) legal ways to abuse that authority to screw the company over, & (c) political power within the company. The money is predicated on having a role with access to those three things, and it's a payment for not abusing them in a time when incentives not to abuse them are removed (because you're being fired). Not very relevant when you're fired on the spot and escorted out of the building, as apparently happened at Twitter, but very relevant in a more traditional (and slow) leadership change. And hence why it's a standard part of contracts for those roles.