“Apple Inc. made all employees, including those in retail stores, eligible for a stock-award program, in a move to retain talent,” Jack Nicas reports for The Wall Street Journal.
Nicas reports, “Apple employees will have to earn the stock awards. Mr. Cook said managers nominate workers for the awards, which are approved by the board of directors.”
“Roughly half of Apple’s employees work in its retail stores,” Nicas reports. “As of Sept. 27, 2014, Apple had 92,600 employees, of whom 46,200 worked in the stores, the company said in its most recent annual report.”
Read more in the full article here.
MacDailyNews Note: Tim Cook’s memo to Apple employees, verbatim:
Team,
I’m writing you today to announce a new stock ownership program for employees.
For many years, we have offered people across the company the opportunity to become shareholders in Apple by participating in the Employee Stock Purchase Plan (ESPP), which makes Apple stock available at a discount that’s exclusive to our employees. Many of you have taken advantage of this program, and I am told we have one of the highest participation rates of any company offering employee stock purchase plans.
In addition to the ESPP, employees in certain roles have been eligible to receive restricted stock units. Each year, the management team recommends eligible employees — typically from our product areas – to receive RSUs as an incentive to continue their important contributions to Apple. Each grant is approved by the Board of Directors.
This year, I’m excited to let you know that the Executive Team has created a new program for stock ownership through RSU grants. It’s designed to reach employees who were not previously eligible, including many in our amazing retail and AppleCare teams.
This new program extends eligibility to everyone not covered by other RSU programs, effectively making everyone who works at Apple eligible for an RSU grant. This is an unusual step, and very special – just like our team.
Please check HRWeb for details on this new program.
At Apple, our most important resource — our soul — is our people. Along with our many progressive benefit plans, this is another way for us to say thanks. On behalf of the Executive Team, I’d like to thank you for your many contributions to Apple. Working with all of you is the privilege of a lifetime.
Best,
Tim
This Stock and apple bonds should have been made available to Apple employees many years ago, so now its a case of better late then never
When the retail stores first opened, retail employees were granted stock options, vested over two years. They discontinued that after about the first 20 stores opened. Thankfully I was in a store that received the options. Made quite a chunk of change off of it.
I’m not a stock playing person. I’ve read the new on the other Apple centric sites, but no real explanation on what happens after its vested? How many years and what exactly can you do with it after its vested? Is it cash equivalent?
Apple awards the RSUs as a bonus dollar equivalent. For example, for performance they award you $5,000 in RSUs, which are converted to shares when they are vested. In that year you pay regular taxes on that value as additional gross income. Since they didn’t actually give you any cash, you may have to sell some of those shares to pay the additional tax. However, after that, the residual shares are yours, and of course any future capital gains.
The RSUs are vested over future years to encourage you to stay with the company. If you leave before vesting occurs, the unvested RSUs are voided.
In essence, they’ve just given you a $5,000 bonus, but you’ll have to stick with Apple to collect it. It means they like your work, now stick around, and collect more RSUs next year.
What’s unknown at this point is the share price they use when they vest the shares. Apple typically awards shares based on the discounted share price as of some certain date. Time will tell.
Awesome for explaining in plain English. Thank you! 😊
I just learned that Apple converts the dollar award to a number of shares on the vesting date based on that day’s stock price. They then actually distribute the shares to you over a specified period, say every six months over four years. The amount of additional gross income you get annually from the stock then depends on the number of shares you get in that calendar year multiplied by the share price on the initial vesting date.
If you leave before receiving all of the stock, you lose the residual shares.