Apple Inc. has delayed bonuses for certain corporate divisions and expanded its cost-cutting efforts to streamline operations during uncertain times. The shift will reduce the frequency of bonuses for some of Apple’s corporate workforce, as the company limits hiring for more jobs and leaves additional positions open when employees depart.
Previously, Apple distributed bonuses and promotions once or twice per year depending on the division, with the twice-a-year teams receiving bonuses and promotions in April and October.
However, under the new plan, these teams will no longer receive bonuses or promotions next month, and all divisions will move to an annual schedule, with payments occurring only in October.
While the majority of Apple’s divisions had already moved to a once-a-year schedule for bonuses and promotions, some staff in operations, corporate retail, and other groups were still on the outgoing biannual plan.
The move will affect engineers, mid-level managers, and other non-managers but will not apply to senior employees at the director level and above, who typically receive their bonuses quarterly.
Apple’s decision to delay bonuses and expand its cost-cutting efforts is in line with other Silicon Valley companies, as the uncertain economic climate caused by galloping inflation and recession fears has pushed them to adopt a more cautious approach.
While Apple has avoided mass layoffs like its tech peers, it has reduced budgets, cut headcount goals, and paused hiring across several divisions.
While employees will still receive their full bonuses in a single payment, rather than two installments, the change could come as a blow to staff, especially because Apple has not provided much advance notice in some cases.
Apple’s New Cost-Cutting Measures
Many workers depend on bonuses for personal budgeting, and the move could potentially help retain employees who may have planned to leave the company after receiving the April payout. However, the alteration may also lead to increased job dissatisfaction among employees and a decrease in productivity.
To further reduce costs, Cook is taking a pay cut himself, with his compensation for 2023 dropping by over 40% to around $49 million.
Apple’s human-resources department has also been examining how often employees come to the office, requiring employees to work from an Apple building three times per week, which has raised concerns among staffers who fear that increased scrutiny on office attendance is a precursor to the company firing workers who don’t meet the three-days-a-week threshold.
Despite these cost-cutting measures, Apple continues to invest in innovation. The company has been able to avoid layoffs by being more measured in its hiring and spending during the pandemic, unlike other big Silicon Valley companies such as Meta Platforms Inc. and Alphabet Inc.’s Google, which have undergone deep cuts.
However, the company’s employees are still feeling the effects of the sales slowdown and the more cautious approach to spending and hiring.