According to a new report published by Bloomberg News, Tesla Inc. (NASDAQ:TSLA) has stopped giving annual performance-based stock awards to employees. Salaried staff were informed by their managers that the electric vehicle manufacturer would not be continuing this traditional form of compensation this year.
Company-Wide Change Impacting Various Departments
Employees from various departments told Bloomberg News they believe this change is being widely implemented across the company. This signals a significant shift in Tesla's compensation strategy, which has historically incorporated stock options as a component to attract and retain talent.
Salaries Adjusted Despite Suspended Stock Awards
Despite the suspension of stock awards, the company has made adjustments to salaries. Employees received modest cost of living increases on top of adjustments to base pays to adapt to current economic conditions. This suggests efforts to keep overall employee compensation competitive even without offering performance-based stock compensation.
"Renewals" of Stock Granted to Some Longer-Term Employees
Additionally, some employees who completed the first four-year stock earning period were given stock "renewals". This appears to be Tesla's attempt to maintain competitive total rewards packages and align financial incentives with long term company performance for these employees.