TikTok owner ByteDance on April 15 communicated details regarding year-end merit pay with its employees, also offering them the option of exchanging their bonuses for ByteDance’s untraded stocks at $142 per share, local media outlet Jiemian News learned from sources familiar with the matter.
The company’s employees will receive either six-month or three-month year-end merit pay on the basis of departmental and individual evaluation. On-the-job employees received a new round of share option buyback notices, but they could only trade a certain proportion of them. Departing employees did not receive the notice.
The last round of share option buybacks at ByteDance was in October 2021, with a price tag of $132 per share, which also only involved on-the-job employees. Compared with the previous round, the purchase price this year increased by about 8%, which is considered satisfactory for many employees.
ByteDance initiated two share option buybacks in 2021, with prices of $132 per share in October and $126 per share in May, showing a steady rising trend.
Share option buybacks with high frequency and continuous increase of repurchase price are considered as compensation for disguised salary reductions last year. Since August 1 of last year, ByteDance cancelled its big/small week policy, whereby employees worked six days a week, every other week. Due to the cancellation of overtime pay on weekends, all employees in ByteDance have a general salary reduction of 17%. The rising share option buyback price may increase the cash income of employees.
It takes four years for ByteDance’s options to be granted and fully attributed, with coverage rates of 15%, 25%, 25% and 35% respectively.