Firm, which laid off 10% of workforce in July, hopes flexible shares-cash compensation will incentivize employees
E-commerce company Shopify is introducing a new compensation system it hopes will provide employees with more financial flexibility.
“Flex Comp” allows employees to choose a mix of cash, restricted stock units and stock options, with the ability to withdraw equity immediately. However, staff will receive a 5% bonus if they allocate more money to equity than is required under minimum “guardrails”.
"Now, our employees can choose exactly how they want to allocate their total reward. Saving to buy a house? Take more cash. Early in your career? You might want to take more restricted stock units (RSUs) or options," the company said in a media release on Friday.
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In addition, the company said it is scrapping the equity lock-in for the first year of employment. Under the previous structure, management decided the mix of cash and stock staff would receive.
"This means your equity will no longer be tied to the quarter you started, and you can adjust your choices as your needs change," the company said.
"Flex Comp was the next logical build for Shopify to continue building a company for people - based on flexibility and choice. We think the world we're building will incentivize employees for the long term wherever they are," it added.
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"For now, we thank our employees who support that mission when they pick RSUs or options with a 5% bonus on any extra equity they choose. In the future, we'll add in elements like charitable donations and Shop Cash – because dollars that travel (from us to our merchants to their employees and beyond) are better for the world than dollars that don't."
The new compensation model appears to be an attempt to improve staff morale, after the company announced in July it would lay off 10% of its workforce.