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Measuring median wage of Starbucks employees against the one time multi-year strictly performance based stock-option plan given to the new CEO is so blatantly d

Measuring median wage of Starbucks employees against the one time multi-year strictly performance based stock-option plan given to the new CEO is so blatantly dishonest I can barely read the rest of the article. Especially when Starbucks awards stock and healthcare plans to even part time baristas. Probably one of the better major employers of low skill labor in the world.

Hikikomori 1y ago
Is part of the performance keeping worker wages as low as possible?
- missedthecue 1y ago
  No. If keeping worker wages as low as possible was the goal, they wouldn't award stock or healthcare benefits to part time workers in their kitchens. The point is that poaching a new CEO from another company (in this case, Chipotle), and awarding him a pile of stock options if he hits certain metrics is not pay, is not comparable to W2 income, does not hit his bank account, and does not make anyone else poorer, except theoretically the shareholders, who were so excited to hire this new guy that the stock literally popped 20% when the news broke.
  - FredPret 1y ago
    This is a point always missed in debates about CEO pay. The money doesn't rain from the sky onto his yacht. Shareholders have to shell it out, and they'd prefer the CEO works for free. That CEO has to add billions to their bottom line in order to get paid millions.
    - JKCalhoun 1y ago
      Nice if CEO was something like an election — with competing CEO's listing their qualifications, how much they expect in compensation. Shareholders could vote for the CEO + pay package they prefer.
  - simoncion 1y ago
    > ...awarding him a pile of stock options if he hits certain metrics is not pay, is not comparable to W2 income, does not hit his bank account... Are you certain that they are options, and not RSUs? The bonus plan described in the SEC filing [0] seems to indicate that the stock offered is not options. My RSUs absolutely counted as wages once they vested, and I was absolutely able to turn them into cash in my bank account (as would have been the case with stock options that were worth something). [0] <https://www.sec.gov/Archives/edgar/data/829224/000119312524200724/d848513dex101.htm https://www.sec.gov/Archives/edgar/data/829224/0001193125242...>
    - missedthecue 1y ago
      Good question. Options was casual nomenclature. He received PSRUs, which are Performance-based Restricted Stock Units. For him they vest through 2027 depending on if his hits the metrics or not. Failure to hit means no vesting at all. Some of his metrics are about store renovations, revamping the rewards program, and hitting some internal financial operating ratios, and a couple other things.
      - simoncion 1y ago
        So, I'm not sure what your claim is. Is it something like "bonus pay is totally incomparable to regular wage pay and does not enter your bank account"? That's the most charitable interpretation I can make out of > ...awarding him a pile of [RSUs] if he hits certain metrics is not pay, is not comparable to W2 income, does not hit his bank account...
        missedthecue 1y ago
        Performance pay that requires you to hit multiple metrics over a number of years, metrics you may or may not hit, due to unpredictable factors within and outside of your control, is not comparable to guaranteed wage income in a single year. That's my point. Their CEO has a W-2 salary and cash bonus. It is about $5m a year. They should use that. We all know the reason they pull forward the next 3 years of maybe money and compare it against a part-time barista's single year pay. Because it juices the ratio and makes for a more outrageous headline. But it's dishonest. Starbucks CEO is not paid $98m per annum.
  - _DeadFred_ 1y ago
    You realize minimum wage workers have to meet metrics, right? So he should be paid more for... doing the job like minimum wage workers do?
    - missedthecue 1y ago
      yes I realize that, I worked a minimum wage job for a long time. The CEO has daily job requirements to meet too, and for that the Starbucks CEO receives a cash salary of about $5m a year. This publication should use that for the ratio, rather than pulling forward the next three years of RSUs that only vest if he hits extremely broad strategy dependent goals that can easily be sunk because of a pandemic or general economic recession.
      - _DeadFred_ 1y ago
        The CEO has NOTHING like the metrics held to the feet of a minimum wage worker who doesn't have the cushion to handle missing one paycheck.
- FredPret 1y ago
  You're not asking this in good faith, but I'll give my answer anyway: companies have an interest in paying workers market wages, not more, and not much less. Too much over the market rate, and you're not maximally efficient at converting economic inputs into larger economic outputs. Too much under the market rate, and you'll see increased employee churn, leading to all sorts of other problems. If you want workers to be paid more, as we all do, even us greedy capitalists, their economic productivity has to go up (not the same as working harder). The best way to do that - as far as I know - is improving technology and education.
  - JKCalhoun 1y ago
    Could you explain then why CEO's are not paid at "market rate"? Or is market rate for CEO's basically hundreds of millions or billions of dollars?
    - FredPret 1y ago
      If you had a $100B asset, like Starbucks Inc, how much would you pay to search for and keep the right guy to run it? The Venn diagram of people who have the diversity and depth of skills to pull off a major CEO role has a very small overlapped area. If you choose your CEO well, you turn Apple in 1997 into Apple in 2010. If you choose poorly, your investment stagnates or evaporates. So a couple of tens of millions in stock options are a bargain for investors. The value-add of any particular minimum wage employee, despite their equal human dignity and worth, is never going to even be in the same league.

Hikikomori 1y ago

Is part of the performance keeping worker wages as low as possible?

missedthecue 1y ago
No. If keeping worker wages as low as possible was the goal, they wouldn't award stock or healthcare benefits to part time workers in their kitchens. The point is that poaching a new CEO from another company (in this case, Chipotle), and awarding him a pile of stock options if he hits certain metrics is not pay, is not comparable to W2 income, does not hit his bank account, and does not make anyone else poorer, except theoretically the shareholders, who were so excited to hire this new guy that the stock literally popped 20% when the news broke.
- FredPret 1y ago
  This is a point always missed in debates about CEO pay. The money doesn't rain from the sky onto his yacht. Shareholders have to shell it out, and they'd prefer the CEO works for free. That CEO has to add billions to their bottom line in order to get paid millions.
  - JKCalhoun 1y ago
    Nice if CEO was something like an election — with competing CEO's listing their qualifications, how much they expect in compensation. Shareholders could vote for the CEO + pay package they prefer.
- simoncion 1y ago
  > ...awarding him a pile of stock options if he hits certain metrics is not pay, is not comparable to W2 income, does not hit his bank account... Are you certain that they are options, and not RSUs? The bonus plan described in the SEC filing [0] seems to indicate that the stock offered is not options. My RSUs absolutely counted as wages once they vested, and I was absolutely able to turn them into cash in my bank account (as would have been the case with stock options that were worth something). [0] <https://www.sec.gov/Archives/edgar/data/829224/000119312524200724/d848513dex101.htm https://www.sec.gov/Archives/edgar/data/829224/0001193125242...>
  - missedthecue 1y ago
    Good question. Options was casual nomenclature. He received PSRUs, which are Performance-based Restricted Stock Units. For him they vest through 2027 depending on if his hits the metrics or not. Failure to hit means no vesting at all. Some of his metrics are about store renovations, revamping the rewards program, and hitting some internal financial operating ratios, and a couple other things.
    - simoncion 1y ago
      So, I'm not sure what your claim is. Is it something like "bonus pay is totally incomparable to regular wage pay and does not enter your bank account"? That's the most charitable interpretation I can make out of > ...awarding him a pile of [RSUs] if he hits certain metrics is not pay, is not comparable to W2 income, does not hit his bank account...
      - missedthecue 1y ago
        Performance pay that requires you to hit multiple metrics over a number of years, metrics you may or may not hit, due to unpredictable factors within and outside of your control, is not comparable to guaranteed wage income in a single year. That's my point. Their CEO has a W-2 salary and cash bonus. It is about $5m a year. They should use that. We all know the reason they pull forward the next 3 years of maybe money and compare it against a part-time barista's single year pay. Because it juices the ratio and makes for a more outrageous headline. But it's dishonest. Starbucks CEO is not paid $98m per annum.
- _DeadFred_ 1y ago
  You realize minimum wage workers have to meet metrics, right? So he should be paid more for... doing the job like minimum wage workers do?
  - missedthecue 1y ago
    yes I realize that, I worked a minimum wage job for a long time. The CEO has daily job requirements to meet too, and for that the Starbucks CEO receives a cash salary of about $5m a year. This publication should use that for the ratio, rather than pulling forward the next three years of RSUs that only vest if he hits extremely broad strategy dependent goals that can easily be sunk because of a pandemic or general economic recession.
    - _DeadFred_ 1y ago
      The CEO has NOTHING like the metrics held to the feet of a minimum wage worker who doesn't have the cushion to handle missing one paycheck.
FredPret 1y ago
You're not asking this in good faith, but I'll give my answer anyway: companies have an interest in paying workers market wages, not more, and not much less. Too much over the market rate, and you're not maximally efficient at converting economic inputs into larger economic outputs. Too much under the market rate, and you'll see increased employee churn, leading to all sorts of other problems. If you want workers to be paid more, as we all do, even us greedy capitalists, their economic productivity has to go up (not the same as working harder). The best way to do that - as far as I know - is improving technology and education.
- JKCalhoun 1y ago
  Could you explain then why CEO's are not paid at "market rate"? Or is market rate for CEO's basically hundreds of millions or billions of dollars?
  - FredPret 1y ago
    If you had a $100B asset, like Starbucks Inc, how much would you pay to search for and keep the right guy to run it? The Venn diagram of people who have the diversity and depth of skills to pull off a major CEO role has a very small overlapped area. If you choose your CEO well, you turn Apple in 1997 into Apple in 2010. If you choose poorly, your investment stagnates or evaporates. So a couple of tens of millions in stock options are a bargain for investors. The value-add of any particular minimum wage employee, despite their equal human dignity and worth, is never going to even be in the same league.