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Elon Musk has reportedly come up with a customarily unorthodox policy for the compensation of X employees, informing staff that their ability to earn stock grants will depend on their contributions to the company.
In an email sent to the workforce of the social media platform last week as reported by The Verge, Musk revealed that workers wishing to receive stock grants must summarize their achievements and impact on the company in a one-page document.
The document will then be sent to X's leadership teams for review. It isn't clear exactly what the adjudication process will look like, nor how long it will take to enact.
Since Musk's controversial arrival at X, uncertainty and tensions surrounding compensation have been high, with a source from X reporting to The Verge that staff are yet to be paid an annual equity refresher that was due in April.
According to two employees, Musk promised X staff that they would be regularly able to cash out stock—a policy he has previously enacted at SpaceX.
What stock grants are affected by Musk's policy?
The most recent stock refresh for X employees came in October 2023, with the company valued at $19 billion, a drop from the $44 billion that Musk paid for the platform a year earlier in October 2022.
Stock grants are a form of compensation, offering employees corporate stock in the company which can either be kept by the worker or, typically after a vesting period that lasts multiple years, can be sold by the employee.
This form of compensation has been popular for American tech companies for many years as it can often tie employees to the company as they wait for their shares to vest, with the worker standing to profit if the company’s share price increases in value compared to the price point at which their shares were granted.
In October 2023, X employees were granted restricted stock units (RSUs) at a share price of $45.
Musk's decision to link stock grants to proof of employee accomplishments appears to be an effort to motivate his team to finish tasks that ultimately boost the company's stock value.
Employee discontent continues to brew at "ruthless" X.
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But troubled waters at X have left employees concerned about their future compensation as well as the possibility of promotions.
X staff previously claimed the company's promotion process has been delayed by the company with no explanation. At a recent company all-hands, employees reportedly hoped for clarity on when performance reviews and subsequent promotions would be taking place.
The Verge reported that X's Head of HR, Walter Gilbert, suggested the social media platform would be introducing more robust promotion processes, including "lightweight check-ins throughout the year," but a source added that most employee questions about "HR, promotions, raises/equity" were not addressed.
Since Musk's X takeover in 2022 and his promise to deliver "Twitter 2.0," several changes have been poorly received by employees.
Shortly after the acquisition, Musk famously demanded employees either commit to a new era of "hardcore" Twitter by clicking an email link or else exit the company with three months’ severance. The bold move prompted around half of his workforce to take voluntary resignation.
Recently, one former senior employee at Twitter’s European headquarters in Ireland was awarded $550,000 in compensation after a tribunal ruled that his failure to respond to an email from Elon Musk did not mean he had resigned.
The employee's legal representative praised the decision as a signal that "even large companies like Twitter must adhere to employee rights.
But it seems that Musk's latest policy for remaining may also be unpopular with employees and other pro-worker voices.
Gergely Orosz, a former engineer at Skype and Uber and technology industry expert criticized Musk’s latest policy on X: “X continues to be the definition of a ruthless workplace from all I understand. Push people working there to the max with expectations above most (all?) other tech companies, compensation below (no equity!), but STILL make these people prove they deserve market comp.”
X has not publicly responded to media requests for comment on the new compensation policy.
