Meta cuts equity-based awards for employees but approves up to 200% bonus for bosses

Meta has made some notable changes to its compensation structure amid its heavy push to AI.

While the Facebook parent company is reducing its annual equity-based awards for employees, Meta has now approved a plan that could see executives earn bonuses of up to 200% of their base salary.

The new bonus plan aims to motivate executives and reward them for their performance. In an SEC filing, as seen by Financial Times, Meta explained that the increased bonus is designed to “focus on company priorities and reward executives for company results and achievements.”

The plan will raise the potential bonus from 75% to 200% of their base pay. However, the boost does not apply to Meta’s CEO, Mark Zuckerberg, as his compensation is mostly tied to stock options rather than bonuses.

“Equity-based awards for employees” means giving employees company stock or stock options as part of their pay. This is meant to motivate them to help the company succeed.

This move comes as Meta deals with a round of layoffs due to underperformance, affecting about 4,000 employees, or roughly 5% of its workforce. The job cuts were first reported by Bloomberg.

The layoffs, which Meta says target low-performing employees, have caused some surprise. Affected workers, some of whom had received positive reviews, expressed confusion over the cuts.

One employee said they were caught off guard by the layoff decision, despite a solid performance history. A Meta spokesperson responded to Business Insider, “Simply because someone had a history of meeting or exceeding expectations, does not mean they continue to consistently meet the bar.”