You miserable, miserable, tosser

Most technology companies reserve a large chunk of shares for founders, and Amazon is no exception. Bezos currently owns nearly 60 million shares, or 11% of the company, even after having liquidated $12bn of shares (Bezos’s ex-wife MacKenzie holds 4%, as part of their divorce agreement last year). Of the shares held by employees, ownership is heavily concentrated among early employees in executive roles. The workers most at risk during this pandemic are severely underrepresented: warehouse workers, who were previously awarded approximately one share per year, saw their pay adjusted in 2018 to remove even that paltry grant.

There was considerable public pressure that Amazon should raise the cash wages of those workers. There were even insistences, in law, that the wage paid must rise – that minimum wage stuff.

So, Amazon did a demanded, raised the cash portion of compensation and adjusted the non-cash portion to balance.

They are to be castigated for this?

13 thoughts on “You miserable, miserable, tosser”

  1. Most tech companies reserve shares for founders?

    Don’t founders by default start with full ownership of the tech companies they create and then sell parts of their ownership as needed. It’s not EVUL CORPARASHHUNS choosing to make rich people richer…

  2. It’s the same level of financial ineptitude that causes these “journalists” to castigate companies like Google for paying their UK employees fairly stratospheric salaries and thus reducing their profits and “robbing The Treasury” by paying less Corporation Tax… Sublimely unaware that the income tax and NI on said salaries is far higher than the CT that’s “avoided”.

  3. And the main reason that early employees are paid heavily in shares is that that’s often all a company has to attract people. “Sorry, we aren’t paying what IBM is, but we’ll give you 2% of the company”. It’s why Microsoft created so many multi-millionaire employees.

    Turn up later and it’s just a job.

    It’s also why tech companies are top heavy with men. Women join companies when they’re in shiny offices paying nice salaries and pensions. By that point, all the senior posts are taken with guys who were employee number 6.

  4. Surreptitious Evil

    Google’s first secretary / office admin person was employee no 8, iirc. She’s rather well off now (and still working there, again iirc.)

  5. ‘The tech giant has seized the opportunity to recast itself as a corporate saviour, but at the expense of its workers. It needs disrupting’

    Automation. That’ll fix it.

    Note that Liu is a 3rd party. It’s none of her fvcking business. She wants to save the employees from their own decisions.

    Corporations at formation often retain substantial “treasury stock.” Shares which are owned by the company itself.

    Baron Jackfield is correct. Journalists publishing their ignorance. And, politics of envy. Ms Liu is morally bankrupt. Then again, as reliable as the sun coming up, the Guardian publishes this junk.

  6. ‘ Most technology companies reserve a large chunk of shares for founders, and Amazon is no exception. ’

    How disgraceful, keeping your own property!

  7. Bloke in North Dorset

    ‘ Most technology companies reserve a large chunk of shares for founders, and Amazon is no exception. ’

    One issue has been multiple classes of shares and these have been used to give the founders control whilst selling a large chunk of the company.

    Its worked well with a few notable exceptions, IIRC American Apparel, Uber and WE had this problem when their founders when off the rails, but as far as I’m concerned investors knew that when they went in, caveat emptor and all that.

    In Asia it wasn’t that obvious. They had really tangled webs of companies and trusts that allowed families and other small groups to have an inordinate amount of control with a very small shareholding. I believe a lot of that has stopped.

    As for the author:

    Wendy Liu is a former computer programmer based in San Francisco, and author of Abolish Silicon Valley

    Am I the only one wondering if their auto-correct changed failed to former and she has a chip on he shoulder?

  8. One of the big problems with an entrepreneurial and enterprising society is that it encourages people to start businesses, and sometimes these are businesses doing something no one has done before, or perhaps no one has done quite as effectively. They start out being closely held and gradually might sell off bits of stock at higher and higher valuations to fund their growth. Many fail, but sometimes the successes turn out huge and the people who make the most money are the founders, early employees and investors. And then they become unequal.

    Creating a more equal society is certainly going to require pulling the reins in tight on enterprising individuals and those evil financiers who back them.

  9. As always, the ignorant “controllers” want to meddle in something they don’t understand, but blame others and demand someone else fix the problem they have created, without taking responsibility or apologising.

    As we see with Captain Potato, they have a plentitude of arrogance and self-righteousness. Their hubris is dialled-up to 11, but their knowledge and experience is at a cold hard zero.

  10. @BiND

    When I worked for AXA (90s), I was once in the PAris HO shown a chart (which took up a sheet of A2) setting out all the holding companies and their relative shareholdings. It basically allowed the ultimate holding company to retain 51% control (through multiple companies higher up the chain) while still allowing shares to be sold in the lower level operations. My immediate (unvoiced) reaction was that this wouldn’t be permitted in the UK, but I’m no Company Law expert.

  11. @Baron Jackfield

    +1 Frankly, I don’t believe the politicians and journos don’t know more tax is paid if google etc pay high bonuses and low CT. They’re exploiting the limited knowledge of public.

    Why Tories don’t repeatedly point out More Tax paid is frustrating

    @BoM4

    +1 Women don’t want to work in a garage, shed, loft, warehouse unit

    @Chris Miller

    China uses similar tactic to gain majority control of firms (eg Pirreli)

  12. @Bloke on M4 said

    And the main reason that early employees are paid heavily in shares is that that’s often all a company has to attract people. “Sorry, we aren’t paying what IBM is, but we’ll give you 2% of the company”. It’s why Microsoft created so many multi-millionaire employees.

    Turn up later and it’s just a job.

    Yep. And the unspoken part missed by those turning up later (and complaining*) is that very often the early employees took huge risks – work very hard for several years at a low salary and without any other benefits (pension contr, etc). The risk of course being that the company folds and one has to quickly take any other job, having accrued no financial cushion to now be choosy.

    Numbers for context: IBM – £50-60k; Other – £60-90k; top end (banking) £130k+. Startup £20-25k.

    * Or rather having some envious journo do so on their behalf.

    —————————-

    I’m a contractor, but get offered these sorts of jobs multiple times per week. I’m well aware that IBM will pay top engineers at e.g. Hursley park far more, but wanted to give people outside of the industry an idea of general salaries. I’ve joined a number of startups over the years, so have also experienced that salary level too. None of them ended well, unfortunately.

Leave a Reply

Your email address will not be published. Required fields are marked *