In an announcement this week, Microsoft Corp. stated that they would almost double their budget for pay increases for the workers based on merit. Essentially, this is to try and stop the employees from leaving for their rivals like Alphabet Inc’s Google and Amazon.com Inc. Additionally, they stated that they would increase the annual stock options by as much as 25%.
The Chief Executive Satya Nadella himself confirmed the good news to the Microsoft staff through an internally circulated email. In it, he stated how they have often noticed that their ‘talent in in high demand.’ He accounted this to the ‘amazing work’ the employees showcase to ’empower’ the company’s partners and customers. Nadella went on to note how the workers’ ‘impact is both recognised and deeply appreciated’ in the leadership team, going on to extend his gratitude towards them. He specified how this was the reason why the company was making these ‘long-term investments’ in all of them.
“Specifically, we are nearly doubling the global merit budget. Merit budgets will vary by country, based on local market data, and the most meaningful increases will be focused where the market demands and on early to mid-career levels. We are also increasing annual stock ranges by at least 25 percent for all levels 67 and below.”
Nadella referred to the employees up to the level of senior director by the use of ‘levels 67 and below.’ The workers who have reached what Microsoft essentially calls the ‘partner level’ are not included in the memo. Mainly, this includes general mangers, vice presidents and other higher ranking executives. Moreover, this comes with the closure of Microsoft’s 2022 fiscal year, coming on June 30. Along with it, it comes just before its timeline for determining compensation based on rewards coming fall.
Microsoft is allocating additional money to ones who are in the middle juncture of their careers. This appears similar to other big tech companies around the globe who are increasing employees’ pay to retain valuable bodies. Moreover, this increase comes after an internal company poll showing that only 66% believe that they get a ‘good deal’ in there when it comes to pay and their self worth.
Similarly, Amazon.com Inc had announced pay hikes in February doubling the maximum base pay to $3,50,000 from $1,60,000 for employees in the tech and corporate fields. Google also initiated the year with pay increases of four its top executives.