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> Tech compensation is funny. Yes there's engineers at Netflix and friends making 600k in "total comp", but that doesn't mean 600k hits their bank account. I t

by rwmj 4y ago

> Tech compensation is funny. Yes there's engineers at Netflix and friends making 600k in "total comp", but that doesn't mean 600k hits their bank account. I thought the common definition of "total comp" is that 600k (well, less tax) does actually hit your bank account? Is there another definition? [For the record I've never earned anything like that or heard of any regular software engineers earning that, but I guess it may happen in SV.]

tazjin 4y ago
Total comp means regular salary, plus bonuses and stock, but pre-tax.
Arkhaine_kupo 4y ago
Total comp sometimes includes stuff like Options (which might never cash out), bonuses (based on things you cannot control like quarterly sales) or include benefits. So for example if your company pays a dental insurance that costs 2,000 a year it might say your salary is 50k but your total comp is 52k. So an example could be. Your salary is 50k, your benefits are calcualted to be 10k, your options ammount to 20k and your bonus is 20k. Your total comp is 100k, but because options vest slowly you only make 1/4 of that and the bonus did not work out, so your take home salary was 55k + benefits. This can change depending on the company, role, country, contract etc. Its not really like total comp is a legal definition.
- gnaman 4y ago
  I've never heard anyone include the value of benefits in TC. TC is usually referred to as the cold cash you take home pre-tax. It can be stock, bonuses or salary. 100% liquid
  - Arkhaine_kupo 4y ago
    In my HR portal benefits show up as part of the TC calculation, includes things like pension matching so it is not unwarranted entirely as cash calculation. But it also includes BS like will writting so yeah, I have seen some funky TC calcs out there
  - scruple 4y ago
    It's common rhetoric from management when bonus targets aren't met, IME.
- hamburglar 4y ago
  Total comp should never include options or benefits like medical/dental. It’s just cash or things with a liquid cash value. It’s not what hits your bank account, though, because it’s pre-tax. And yes, FAANG TC of >600k for senior IC’s is absolutely a thing. The article is correct in a lot of its characterization. Your output is a lot of documents and strategic influence and not a lot of code (aka “getting things done”). But that doesn’t mean it has to be unfulfilling. You can get things done by making a compelling technical argument based on your experience and convincing hundreds of people to go build the architecture you envisioned. Do you get the thrill of debugging the code at 4am? No, you don’t. You only get that from skunkworks projects and side endeavors. But it’s still gratifying. And it pays embarrassingly well.
mackman 4y ago
Part of his argument here is stock is funny money. I think that is less true at FAANG today. You start vesting in a quarter, vest monthly after that, and RSUs are treated as income unlike options. Yes stock may change a bit but it’s more likely than not to stay within the 550-650k range. It’s not at all like illiquid startups.
- hamburglar 4y ago
  For sure. If you have 300k/yr in RSUs from a trillion dollar company, you may not be able to predict the exact value of that comp 4 years from now, but it’s pretty reasonable to assume its value isn’t going to be diminished significantly, unlike startup equity.

by rwmj 4y ago

tazjin 4y ago

Total comp means regular salary, plus bonuses and stock, but pre-tax.

Arkhaine_kupo 4y ago

Total comp sometimes includes stuff like Options (which might never cash out), bonuses (based on things you cannot control like quarterly sales) or include benefits. So for example if your company pays a dental insurance that costs 2,000 a year it might say your salary is 50k but your total comp is 52k. So an example could be. Your salary is 50k, your benefits are calcualted to be 10k, your options ammount to 20k and your bonus is 20k. Your total comp is 100k, but because options vest slowly you only make 1/4 of that and the bonus did not work out, so your take home salary was 55k + benefits. This can change depending on the company, role, country, contract etc. Its not really like total comp is a legal definition.

gnaman 4y ago
I've never heard anyone include the value of benefits in TC. TC is usually referred to as the cold cash you take home pre-tax. It can be stock, bonuses or salary. 100% liquid
- Arkhaine_kupo 4y ago
  In my HR portal benefits show up as part of the TC calculation, includes things like pension matching so it is not unwarranted entirely as cash calculation. But it also includes BS like will writting so yeah, I have seen some funky TC calcs out there
- scruple 4y ago
  It's common rhetoric from management when bonus targets aren't met, IME.
hamburglar 4y ago
Total comp should never include options or benefits like medical/dental. It’s just cash or things with a liquid cash value. It’s not what hits your bank account, though, because it’s pre-tax. And yes, FAANG TC of >600k for senior IC’s is absolutely a thing. The article is correct in a lot of its characterization. Your output is a lot of documents and strategic influence and not a lot of code (aka “getting things done”). But that doesn’t mean it has to be unfulfilling. You can get things done by making a compelling technical argument based on your experience and convincing hundreds of people to go build the architecture you envisioned. Do you get the thrill of debugging the code at 4am? No, you don’t. You only get that from skunkworks projects and side endeavors. But it’s still gratifying. And it pays embarrassingly well.

mackman 4y ago

Part of his argument here is stock is funny money. I think that is less true at FAANG today. You start vesting in a quarter, vest monthly after that, and RSUs are treated as income unlike options. Yes stock may change a bit but it’s more likely than not to stay within the 550-650k range. It’s not at all like illiquid startups.

hamburglar 4y ago
For sure. If you have 300k/yr in RSUs from a trillion dollar company, you may not be able to predict the exact value of that comp 4 years from now, but it’s pretty reasonable to assume its value isn’t going to be diminished significantly, unlike startup equity.