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Businesses The Almighty Buck Apple

Apple Gives Employees $2,500 Bonuses After New Tax Law (bloomberg.com) 277

Apple told employees that it's issuing a bonus of $2,500 of restricted stock units, following the introduction of the new U.S. tax law. "The iPhone maker will begin issuing grants to most employees worldwide in the coming months," reports Bloomberg. Apple also announced today that it would bring back most of its cash from overseas and spend $30 billion in the U.S. over the next five years. From the report: Apple confirmed the bonuses in response to a Bloomberg inquiry Wednesday. The Cupertino, California-based company joins a growing list of American businesses that have celebrated the introduction of corporate-friendly tax law with one-time bonuses for staff. AT&T, Comcast, JetBlue, and Wal-Mart also said they were giving bonuses.
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Apple Gives Employees $2,500 Bonuses After New Tax Law

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  • Why? (Score:5, Insightful)

    by Lynal ( 976271 ) on Wednesday January 17, 2018 @07:17PM (#55950121)
    Can any corporate finance experts explain why companies would do this? Should we buy that they're just being generous/trying to foster goodwill?
    • Re:Why? (Score:5, Insightful)

      by Anonymous Coward on Wednesday January 17, 2018 @07:23PM (#55950165)

      It gives the politicians who give away massive amounts of wealth to the corporations a simple talking point.

      • Re:Why? (Score:5, Insightful)

        by dgatwood ( 11270 ) on Thursday January 18, 2018 @02:22AM (#55951577) Homepage Journal

        It gives the politicians who give away massive amounts of wealth to the corporations a simple talking point.

        That's why this move makes very little sense. I've never thought of anybody in Apple's upper echelons as being a Trump supporter by any stretch of the imagination.

        There must be some tax advantage to doing this. Either that or they're bleeding people to Tesla, Google, and Facebook. Or both.

        • Re:Why? (Score:5, Insightful)

          by cascadingstylesheet ( 140919 ) on Thursday January 18, 2018 @09:23AM (#55952477)

          It gives the politicians who give away massive amounts of wealth to the corporations a simple talking point.

          That's why this move makes very little sense. I've never thought of anybody in Apple's upper echelons as being a Trump supporter by any stretch of the imagination.

          Quite right, they aren't. Puzzling, isn't it?

          Maybe ... just maybe ... a better tax environment is better for business, which is better for paid non-governmental employment. Maybe wascally wepubwicans aren't as awful as you thought.

      • Re:Why? (Score:5, Insightful)

        by Anonymous Coward on Thursday January 18, 2018 @05:10AM (#55951881)

        It gives the politicians who give away massive amounts of wealth to the corporations a simple talking point.

        WTF?!?!!?

        NOT TAKING from the people being governed is now "giv[ing] away massive amounts of wealth"?

        So if I don't rob you at gunpoint, I gave you the contents of your wallet?

        What the fuck is wrong with you?

    • Re:Why? (Score:5, Informative)

      by Koby77 ( 992785 ) on Wednesday January 17, 2018 @07:30PM (#55950185)
      While I'm not a corporate finance expert, some explanation can be found here in the latest Federal Reserve Beige Book report:

      https://www.federalreserve.gov... [federalreserve.gov]

      It explains that the United States is FINALLY starting to see an uptick in employment, with some labor shortages, which is key to ordinary Americans seeing an increase in their paycheck. Due to the economic outlook of further expected growth, companies that retain employees stand to grow; companies that don't retain their employees during a labor shortage will likely go out of business. So you're correct to be skeptical about generosity, but it IS an attempt to foster goodwill with their existing employees out of corporate self-interest.
      • Re:Why? (Score:5, Informative)

        by b0s0z0ku ( 752509 ) on Wednesday January 17, 2018 @07:33PM (#55950203)
        Also, the bonuses are paid in restricted stock units (RSUs). They're not literally stock. They're a promise to give stock if the employee stays for x time -- basically, if they leave tomorrow, they get little or nothing.
        • Yup. I'd rather get cash myself. Sure, I still get some cash bonuses, but for awhile most of it was RSUs with strings attached. Every few months I'll get an email that says something like "7 shares have vested!"

      • Re: Why? (Score:5, Insightful)

        by slasher999 ( 513533 ) on Wednesday January 17, 2018 @07:48PM (#55950285)

        BINGO! Precisely it. This is about employee retention above all else. Those of us of a certain age have seen this in the IT industry prior to Y2K. Back then we were seeing bonuses randomly throughout the year several times more than Apple is giving here, and it was a check instead of stock.

      • It's a publicity stunt. Any real/profitable company already issues bonuses to their employees (and they don't issue press releases about it). Also, $2,500 is pretty sad. Didn't fucking WalMart do their big press release last week about issuing $1k bonuses? It's better than nothing, but it's pretty pathetic and definitely only for optics. I'd actually be embarrassed if my friends thought I had some awesome job at Apple and then they found out I got a shitty $2500 bonus (well, probably $1500 after taxes...a
        • Also, $2,500 is pretty sad.

          It probably means a lot more to all those sweatshop workers making iphone parts... oh, wait, they aren't Apple employees, are they? Too bad, kids! Get back to work.

          • Re:Why? (Score:4, Interesting)

            by dgatwood ( 11270 ) on Thursday January 18, 2018 @02:26AM (#55951585) Homepage Journal

            Also, $2,500 is pretty sad.

            It probably means a lot more to all those sweatshop workers making iphone parts... oh, wait, they aren't Apple employees, are they? Too bad, kids! Get back to work.

            No, but it probably will mean a lot to people working in Apple stores, Apple's corporate cafes, other non-engineering personnel, etc. For the engineers, not so much.

      • feeding the supply side doesn't really do much. Companies don't hire because you give them money. They hire because they have more demand. And they pay more because they need to keep talent; and the reason for that is other companies are poaching their workers.
        • Yup. The common reason to hire more workers is if your company is expanding. And they never hire more workers than they actually need. In boom times they may make less prudent hiring decisions (witness the dotcom), but generally they're always paying attention to the bottom line. Extra revenue coming from company growth is likely to mean they want to expand. But extra revenue coming from a tax break is different - it doesn't mean the company is growing, they don't have a larger market, they haven't reduc

      • It's only a labor shortage for certain types of employees. Meanwhile there are many unemployed or homeless people who will only ever see the wrong kind of trickle down.

    • To distract from the bad press they're getting regarding past tax practices, working conditions in Chinese contractors (who are getting bupkiss), etc, etc, etc.
    • I think it's called "marketing".

      Sad that the highly paid Cupertino employees get a bonus, but the assembly line staff in China still get far far less than minimum wage.

      • What about the Assembly line employees in Wisconsin... Oh that's RIGHT, they don't exist YET, but I hear they will.

        Isn't Apple planning to bring a pile of cash home and set up a manufacturing facility in the states? Thought I saw that in the news today. If that's true, my guess is the Chinese contractors will be phased out and their employees cut loose for the state to support. Not good for China, but great for the US..

        • No, they're not going to give up on all those Chinese factories. It means that they may set up a new plant, either for new work, or to augment existing work. I doubt it will replace anything though. If you're manufacturing in bulk and it requires a lot of labor, then the US is not a good place to do it. But there's still demand for US manufacturing in other areas; automated plants for parts, or building/assembling items with smaller quantities (macbooks maybe). For manual labor, most companies want cheap

      • What's worse, making less than (I assume you mean US) minimum wage in a factory in China, or making almost nothing working on a farm in China?

        Also keep in mind that whatever machine you are currently using to write your post was probably made by the same factory workers in China making almost nothing. At least, most of the parts were.

        • What's worse, making less than (I assume you mean US) minimum wage in a factory in China, or making almost nothing working on a farm in China?

          What's worse, being paid almost nothing in a factory that might close down the minute someone builds a machine to do what you do, or to be working on a farm where you can at least grown your own food?

      • by dcw3 ( 649211 )

        I think it's called "marketing".

        Sad that the highly paid Cupertino employees get a bonus, but the assembly line staff in China still get far far less than minimum wage.

        Not saying that the China staff aren't underpaid. However, minimum wage only makes sense when you compare cost of living. I could live like a fucking king in Thailand on about $30k a year, but I couldn't feed and shelter my family here in the DC burbs for the same amount. One site (https://www.numbeo.com/cost-of-living/in/Shenzhen) suggests that the cost of living near the Apple factory in China is about half that of NYC.

    • Re:Why? (Score:4, Insightful)

      by swillden ( 191260 ) <shawn-ds@willden.org> on Wednesday January 17, 2018 @07:49PM (#55950289) Homepage Journal

      Can any corporate finance experts explain why companies would do this? Should we buy that they're just being generous/trying to foster goodwill?

      Why they'd give employees bonuses? Retention, mostly. This is obvious, isn't it?

    • Can any corporate finance experts explain why companies would do this? Should we buy that they're just being generous/trying to foster goodwill?

      My suspicion is it's to publicly fulfill a backroom promise to a politician. I.E., "Put XYZ in the tax law and we'll do this to make it look like it's working."

    • Re: (Score:3, Interesting)

      by quantaman ( 517394 )

      Can any corporate finance experts explain why companies would do this? Should we buy that they're just being generous/trying to foster goodwill?

      IANACFE but...

      The tax cut is awesome for corporations, and their major shareholders in particular.

      But, it's also extremely unpopular because it's generally considered a handout to corporations at the expense of average people, and that creates two problems.

      1) Employees realize the company got a massive pile of cash and can feel resentful that they didn't get any. Resentful employees are employees who might look for work elsewhere.
      2) Nationally the tax bill is unpopular, and there's a decent chance that in 4

      • The tax cut gave me a $1,000 this year. Fuck corporations. I give a shit not about them. I got my money.

      • by dcw3 ( 649211 )

        The tax cut is awesome for corporations, and their major shareholders in particular.

        Don't know about you, but my 401k is up nearly 30% since the election in Nov of 16. Why? Because the markets have been anticipating this tax cut, and now they've got it. Many of you were whining right after the election that this was just a Trump bubble. Well, the bubble has gone on for 15 months now, and will likely pop at some point, but will hardly get near where it was before it started.

    • Why WOULDN'T they? (Score:4, Insightful)

      by SuperKendall ( 25149 ) on Wednesday January 17, 2018 @08:33PM (#55950471)

      There are a million reasons I can think of.

      If all you can do is ascribe selfish reasons to any action, then here is one for you - with some many companies having more money to spend, there were be a lot more poaching of workers going on, and companies are trying to head defection off at the pass by fostering goodwill among employees.

      But again only for absolutely selfish reasons, could not be they are just passing along some good fortune to those that helped them get where they are.

    • Re:Why? (Score:5, Insightful)

      by fluffernutter ( 1411889 ) on Wednesday January 17, 2018 @08:38PM (#55950509)
      Bonuses are the new raise. Because they can get immediate recognition for it, and then conveniently forget to give it ever again.
      • by JD-1027 ( 726234 )
        Also note that bonuses don't usually count towards raises. So if you look at giving someone X% raise, the bonus isn't counted in that calculation. So it is beneficial to have "salary+bonus"=$Y over "salary alone"=$Y. That way the "+bonus" part of the equation never counts in compounding yearly raises.
    • Partly employee retention, and partly midterm elections this year to protect the corporate tax cuts. People will vote based on how their wallets feel this year, not based on the lack of any actual pay raise long term or the size of the deficit.

    • It's a pat on the head for the voters. "You made the right choice."
    • by guruevi ( 827432 )

      In general, I would say tax deductions. It's also in restricted stock units, so they may be trying to get rid of holding onto stock by giving it away to their employees.

    • Fwiw I used to get restricted stock bonuses at Adobe most every year - this is when I worked there 10-12 years ago. They only vest after 5 years - which is what what Apple did in this case. Still after they did layoffs in 2010 (I think) I had collected well over 20k of these - and its not like I was senior engineer of anything (I was a technical account manager).

      These sorts of things never made the news though ;) - its pretty normal in any decent sized company in silicon valley.

      Anyhow like I said - its not

    • Because it generates PR and doesn't cost anything. "Restricted stock units" is worthless to the employees.

      If they wanted to give an actual bonus, they'd give cash or actual stock, you know, like the company's execs probably got. Everyone else just gets blue-sky.

      Silicon valley may do some old-school engineering, but this is an example of what they are really best at- financial engineering. It generates maximum buzz for minimal cost, and probably gets the company another tax break.

    • Sometimes people at the top are humans. Used to eork at a company and they closed shop.not only did we all get an ipad mini and a nice farewell bonus, they saw to it that we all had a new job. Selling the people was more important than selling the customer s.

      Next company had to yake us, with current pay and benefits and they would get the customers for free. One company wanted to pay for customers, but no staff. They did not get the deal.

  • by dAzED1 ( 33635 ) on Wednesday January 17, 2018 @07:26PM (#55950173) Journal
    The combined income of the employees walmart has laid off since that announcement substantially dwarfs the "bonus" offered. The "bonus" was to people who had worked for Walmart for at least 20 years, btw. A pretty sad group.
    • Re: (Score:2, Insightful)

      by jwhyche ( 6192 )

      Calling Bullshit on this. Bullshit!

      Of course you could cite credible sources and prove your case.

      • Re: (Score:3, Flamebait)

        by jwhyche ( 6192 )

        Someone seems to have more mod points than sense.

      • by quonset ( 4839537 ) on Wednesday January 17, 2018 @09:34PM (#55950799)

        Of course you could cite credible sources and prove your case.

        Credile source #1 [businessinsider.com]

        Among that group of employees, only those who have worked for Walmart for 20 years or more will get the full $1,000, Walmart told Business Insider.

        Credible source #2 [cnbc.com]

        The bonuses will be determined by an employee's length of service. Those workers with more than 20 years of experience will qualify to receive the full $1,000. However, workers with less than two years of experience will receive $200, a Walmart spokesman told CNBC.

        Credible source #3 [walmart.com]

        A one-time bonus benefiting all eligible full and part-time hourly associates in the U.S. The amount of the bonus will be based on length of service, with associates with at least 20 years qualifying for $1,000. A discrete one-time charge will be taken in the fourth quarter of the current year to account for the bonus; qualification will be determined before the end of the month and payments will be paid as quickly as practical thereafter.

        As to the difference between the income of those laid off and the bonuses, this article [reuters.com] cites the bonuses will cost $400 million. This article [businessinsider.com] says 9,400 people are being let go during the layoffs. Simple math shows $400 million/9,400 = 42,553. If we assume those being laid off made that much in salary and benefits, then after one year, the amount of money saved by laying off those people will dwarf the one-time bonus amount.

      • Re: (Score:2, Informative)

        by Anonymous Coward

        Since nobody wants to actually do a simplistic google search that takes all of 2 seconds, here's [cnbc.com] a source about it.

        It is part bullshit, part not. The bonus of 1000 dollars for employees is only given in full to those who are part of that sad little 20yr group. Those who have worked 2 years or less (probably the majority of Walmart employees) will only get 200 or so.

        • by jwhyche ( 6192 )

          It is not that someone can't or won't do a "simple" google search. It's the fact that my google search will yield different results from the OP. Google search results change by the hour, or even by the minute. Even if I knew the exact search terms he used to get his information that doesn't mean I will be looking at the exact same article.

          By asking for him to cite his links I'm looking at the exact same data he is.

    • by JeffOwl ( 2858633 ) on Wednesday January 17, 2018 @07:34PM (#55950207)
      The full $1K was for people that had worked there 20 year. People who had worked there for fewer years received a lesser bonus but still got something. I think 2 years was the minimum. And by the way, Walmart would have laid off those people either way.
    • Ask me how I know you've gone mental with liberal hate.

      Ok, here's how I know - because the story is about APPLE. not WALMART.

      APPLE just announced they are hiring 200k employees over the next five years and spending tens of billions more in the US, since they can finally bring money back from overseas. There are no layoffs.

      Meanwhile in completely unrelated news WALMART is just one of many companies giving out bonuses, that just happens to also be laying off some workers. That does not change the benefit o

      • by Hulfs ( 588819 )

        APPLE just announced they are hiring 200k employees over the next five years and spending tens of billions more in the US, since they can finally bring money back from overseas

        http://www.foxbusiness.com/fea... [foxbusiness.com]

        You're an order of magnitude off on that 200K figure...it's 20K jobs. Nothing to scoff at, but also not 200K new jobs.

        Also from the article, "most of the $350 billion reflects money that Apple planned to spend with its suppliers and manufacturers in the U.S. anyway, even if corporate taxes had remaine

  • by American AC in Paris ( 230456 ) on Wednesday January 17, 2018 @09:16PM (#55950707) Homepage

    So I read the linked article, and I couldn't help but notice that the only thing joining the tax law and Apple's bonuses was temporal proximity. The author conspicuously chooses to use words like "after" and "following the introduction of," assiduously avoiding the more concrete "because of." The author also doesn't attribute anything the company actually stated to the tax law, citing instead some phoney-baloney hogwash about "confidence in Apple’s future."

    In fact, if you read the text of the email sent by Tim Cook to Apple employees, [9to5mac.com] you don't see mention of tax policy anywhere--which is weird, seeing as Bloomberg puts "New Tax Law" right in the headline.

    It's almost as if Bloomberg.com were blowing smoke up our collective asses and calling it an invigorating Goop.com vapor colonic.

  • NO! (Score:4, Funny)

    by MellowBob ( 2933537 ) on Wednesday January 17, 2018 @09:24PM (#55950741)

    Republican tax cuts are evil!. Millions will die. Even though the standard deduction doubles, those who make minimum wage will starve as the rich will laugh eating there bones!

  • by Tony Isaac ( 1301187 ) on Wednesday January 17, 2018 @10:38PM (#55951057) Homepage

    So you're a big company, and you don't want trouble from the government. Of course you're going to do something, if you can, to make yourself look good!

    But notice how all these announcements are about bonuses, not pay raises. A bonus is just a one-time event, pay raises keep on giving, month after month. These companies aren't really putting their money where their mouth is, they just want to make a splash in the news.

  • This makes good sense. Apple's getting a windfall from the tax law changes and they're spreading the good cheer. Some of that money goes to employees which makes employees more loyal and more likely to stay and do well at Apple. Most of that money will likely go to Apple's research and development and other initiatives that drive their company. A lot of that spending will be in the USA which is why the politicians wanted to make the change to the laws. This brings home (to the USA) a lot of cash. Good for t

  • by Kazoo the Clown ( 644526 ) on Wednesday January 17, 2018 @10:55PM (#55951113)
    Some of these corporations recognize that people are going to boot the GOP candidates out if the tax cuts don't "trickle down" as promised. And knowing full well that "trickle down" isn't the effect it's been sold to be, they are manually doing a little trickle down in order to keep the pitchforks at bay.
  • by mark_reh ( 2015546 ) on Thursday January 18, 2018 @07:52AM (#55952209) Journal

    And they call that a bonus?

    I'll bet the execs get unrestricted stock.

    Same BS, different decade.

    I was an engineer in the 90s and got stock options the day my company went public. The tee shirt I got on that day ended up worth more than the stock.

    If it isn't cash, it's worthless. Don't accept this BS in lieu of money or even actual stock. It's a PR gimmick.

  • by cascadingstylesheet ( 140919 ) on Thursday January 18, 2018 @09:18AM (#55952449)

    Watch the techie heads explode like a 60's scifi robot caught in a contradiction, lol :)

    Must love Apple ... must hate Trump ... must love Apple ... error, error ...

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