Amazon is the revision of its remuneration model to more clearly reward the sustained higher performance while reducing payments for certain artists below.
According to internal guidelines obtained by Business Insider, Amazon revises its remuneration structure within the remuneration gangs to better recognize and reward long -term efficient.
Employees who obtain a “first level” performance note for four consecutive years will now receive 110% of their remuneration range, exceeding the usual ceiling. On the other hand, the first winners of the first levels will obtain 70% of their remuneration group, compared to 80% last year.
“This approach guarantees a more stable compensation progression,” said the internal remuneration directive, referring to the metric of the total company’s remuneration objective (TCT).
The changes put Amazon as a step with others Great technology Giants that rationalize employee awards and the tightening of global costs. Google has reduced bonuses and equity for sub-performants, Microsoft has introduced stricter exam policies, and Meta Actively reduces its least low employees.
The Amazon spokesperson told Bi that the updated model “distinguishes” better “distinguishes those who have a coherent excellence.
“As always, employee contributions stimulate the result of their annual remuneration exam,” said Amazon spokesperson. “What is different this year is that our approach to remuneration changes now better distinguishes new efficient and those who have always gone out of the expectations of their role and their level.”
“Global value” notes
The 12 -month remuneration cycle of Amazon for employees of companies generally starts in April. Most basic employees receive their remuneration updates in early April.
Although Amazon considers various factors when determining employee remuneration, individual performance ratings – called inside under the name of “overall value” – are a key engine. Employees are classified opposite Five performance levels: High tier (TT), 3 (HV3), much appreciated 2 (HV2), 1 (HV1) and the least effective (the).
Internal directives indicate that performance “has a direct impact”, and OV notes are “used to generate the remuneration recommendation for each employee”.
This year, more weight is on the scores of notation of an employee. For example:
- A leap from HV1 to HV2 now reports 10% of the remuneration range, compared to 20%.
- But someone who goes from HV3 to HV2 still receives 20%, highlighting greater importance on past performance.
- Those who go to HV3 will receive 40% of their remuneration range, not the 50% previously offered.
- An employee with two years of high -level status now obtains 90% of his remuneration band, compared to 100%.
- But 3 consecutive years of higher level can now reach 105% of the range. Those who obtain 4 consecutive years of higher levels can obtain 110% of the range. Previously, it was 100%capped.
- This year, the first high -level beneficiaries will reach 70% of their remuneration band, compared to 80% in previous years.
The Amazon’s remuneration structure has long sparked internal frustration, partly because of its lack of transparency and the competitive nature of the employee classification, as BI previously reported. Managers are invited not to share individual OV ratings with employees, leaving staff deduce Their performance according to changes in their remuneration.
This year’s directives have also said that AMAZON will continue to manage the pilot program which allows employees to take 25% of their new cash scholarships. The remuneration of actions has traditionally represented a large part of Amazon’s total salary, but it has become less attractive for employees who are looking for more immediate financial returns.
Despite the recalibration, Amazon claims that most employees who have shown improvement have always seen increases this year. The company offers “multiple channels” by which employees can raise concerns about remuneration, added the spokesperson.
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