How to know they are screwing you

[yesthattom]

A "bonus" is a reward for past performance.

A grant of "options" is an incentive to do well in the future.

If someone rewards you by giving you more options, then they're just screwing you.

A bonus is for when the group has met certain criteria and the company has done well. They are sharing the wealth. Options are very different. Options are more valuable as the company does better, and less valuable as the company does badly. The point of giving an employee a grant of options is to incent them to do better in the future. That is, to link in their mind behavior that benefits the company to money they will have in the future. If a dog does a trick you reward him with a snack. You don't reward him with a gift certificate that is valid next year, if the company is still in business.

Comments

[lediva.livejournal.com]

*sigh*

[airshipjones.livejournal.com]

I think you forgot to mention that businesses use the stock option thing to change their financial profile to avoid taxes as well. So it servers them as much, if not more, than it does the individual the options are granted to.

[holzman.livejournal.com]

There's options and there's options.

If I can sell that option, then even if it's "out of the money" (can't be exercised profitably at this time) I can still turn it into cash. But I bet that's not the kind of option most people get.

[yesthattom.livejournal.com]

I've never seen anyone get that kind of options... except CEOs and high-up executives.

[madbodger.livejournal.com]

I got a bunch of 'em. I bought a car with them when a company tried to acquire C3.
And ain't no way I was any kind of executive.

[whipartist.livejournal.com]

Actually, I think the biggest reason that companys offer options is to handcuff employees to the company. "I'm really sick of being here, but if I stick around for another year I have a hundred grand in options that will vest, so I can't leave."

[yesthattom.livejournal.com]

Tomato - tomathto :-)

[grendelgongon.livejournal.com]

*chuckle* You know, I'd take options or bonuses. Though of course i'd prefer the bird in hand.

[cappyhead.livejournal.com]

ARGH! You used "incent" as a verb!!!

ARGH!!

[awfief.livejournal.com]

options don't count. at least, not for me. they don't exist, and if I get something out of them later, well, then, yay. if not, then I didn't lose anything. I'm way too practical to live on hope.

[likethewatch.livejournal.com]

I'm not much for the options, either, although in my current employment situation that's sort of like saying I'm not much for the 1988 Laville Haut Brion, either. I was told by the first investment advisor I ever met to diversify. By working at a company, I'm already investing in it.