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Amazon is to cut the salaries of some employees by 50%

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Amazon corporate employees are reportedly facing pay cuts, along with a prolonged decline in the value of the company’s stock. According to Bloomberg, Amazon restricts grant stock units (RSUs) to workers, most likely in higher positions, in an effort to keep them on the team longer. The success of the company and particular departments affect the value of the shares.

When RSUs are granted, employees are encouraged to treat their jobs as if they were their own. According to the paper, Amazon shares fell more than 35% in 2022 as a result of unfavourable macroeconomic conditions, which caused salaries for 2023 to fall 15% to 50% below the estimated target the company has set for its employees.

Individuals with knowledge of the situation told the publication that “the stock price rose an average of about 30% annually between 2017 and the beginning of 2022. However, some employee compensation plans are set up based on the idea that Amazon shares will trade at approx. $170 (approximately Rs. 14,000 per share), although the company’s stock is now selling at approximately $96 per share (approximately Rs. 7,950).

According to the article, Amazon’s human resources division distributed “training documents” to managers to help them deal with pay cuts. Also, managers are urged to hang onto employees until stock prices start to rise.

According to rumours, Amazon typically pays employees less in base salary than its competitors, but employees make up the difference by vesting these shares. The workers claim that the longer an Amazon employee works for the company, the more their pay may be dependent on stock awards, with stock accounting for 50% or more of some employees’ total earnings.

During a wide-ranging meeting at Amazon’s Seattle headquarters, CEO Andy Jassy reportedly also addressed pay cuts. According to the CEO, the market is in a “funky state,” and Amazon has already made the difficult choice of laying off 18,000 employees.

He continued, “Compensation is affected as a result. And it’s challenging. It’s all challenging. But I’m very hopeful that we’ll be able to get through this difficult period stronger than when we started.”

According to Bloomberg, Amazon may be paying lower wages to employees and has stopped giving more RSUs. Additionally, Amazon has withdrawn employment offers from some applicants who had already accepted them.

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