What's the scoop on sti funding?
There's been talk as low as 50% funding.
25 replies (most recent on top)
I am sure that there are a lot of people that are now looking for work outside of AIG. There are a lot of companies that offer better pay and benefits. So if you are offered something that looks more secure than AIG, you should definitely interview for it. You have nothing to loose and it may work out better. Other companies love hiring people that have worked at AIG because they know how hard they have worked.
Was smoke and mirrors for some particular purpose or purposes that was never a sustainable model (like the idea we'll get to profitability but continually cutting heads).
But the folks who put it in and perpetuated the myth are long gone with big fat packages themselves... And probably big fat paychecks elsewhere.
Remaining workforce and shareholders deal with the fallout...
The whole STI concept just isn't right. First they froze raises because of 911 for 18 months. Then the raises were 1-3%, then 1-2%. Eventually no raises at all. Eventhough the cost of living continues to rise. But Senior Management has always made out very well pay wise.
@VOSdZq5-5bud not bashing shareholders just providing some perspective.
It does seem shady and disingenuous doesn't it?
It SHOULD be advertised and used as a bonus. I agree - has been everywhere else I've been.
It was sold and used as a dependable part of the core comp here in lieu of COL increases or a market competitive "base."
Which is why employees react the way they do.
I can't imagine BD's reaction when he came in to this albatross of a program and found how it was sold/used (I suspect this is why the STI reductions didn't apply to all grades last year).
But it isn't that employees are oblivious to the lack of profitability. They are Given how AIG used STI for years many to most employees will feel this as pay cut not as extra bonus that didn't pay. At a time when they are working more hours and days due to all the layoffs... So quite the hit to the effective pay rate per hour... Especially for the worker bees trying to hold things together.
I don't agree with the people bashing stockholders. If you're not too rich to care about your STI, why would stockholders be too rich to care about how much their stock is worth? I own funds (probably most people do) with AIG as part of the market basket, even if I don't own stock directly (I wouldn't advise any employee to voluntarily buy stock- that is pretty much the opposite of diversification of risk; now your job and your assets both depend on the same company).
In most companies, when the company doesn't do well, the STI is not fully funded. Last company I worked for, though doing much better than AIG, had many years when the STI was at 90% or 85%. You could perform really well and get a multiplier of higher than one on your salary, but that was applied along with the low multiplier based on how the company performed.
It seems disingenuous to say that STI is an almost guaranteed part of your income. There's a reason why it's split out, and that reason is because it depends on the company making money. I think that's pretty fair.
agree with @VOSdZq5-4tkp
Lots of post from shareholders telling the employees not to complain about compensation. I just wanted to sincerely say go f--- yourself. If you invested in aig your probably rich to begin with and obviously not that bright cause aig will never make money again.
I agree with @VOSdZq5-1atd. The STI is part of the Total Direct Compensation. It is your Base Salary and Short Term Incentive. If you are upper and senior Management (grade 24 and higher), you get Long Term Incentives at the end of the year as well as stock. STI is part of the compensation structure.
VOSdZq5-1atd drops the mic and walks off stage nuf said.....
We get it shareholder advocate. I don't disagree where it is and has been structured as a bonus.
The whole point is AIG used STI as core comp not a bonus. Dumb decision but their dumb decision. So while a fair point from a shareholder / company perspective to say don't pay it is an equally fair point for employees to voice concern.
Very arrogant to continually belittle people's concern over their livelihood, health insurance and so on to say "go find other work."
You don't know anyone's circumstance. It likely isn't that easy or simple for everyone.
And if you are so concerned about shareholder value you better hope the remaining people with knowledge don't heed your advice and bolt. Large part of the issues we are dealing with come from having the wrong people without the right knowledge making decisions.
Earning report comes out on the 31st. If you make money you get a Bonus if not why should you get one. Stock price is down 33% since BD came onboard. What about the stockholder??? The company has not made money 10 out of 13 quarters. Leave and find a company where you can use your skills to make a profit.
Any confirmations on this STI speculations?
I've heard ppl at HQ with long term tenure (over 5 years) requesting to be let go to avail of STI. Can anyone confirm?
What's Strategy team up to? Other than listening to the c-ap consultants have to offer?
@VOSdZq5-sfh : "So the mistake AIG made was selling STI as a dependable part of compensation and NOT a bonus. Like not a bonus was emphasized. "
This is correct. when they give any tiny increase, they usually give it on the STI side mostly under "your total comp" is getting higher mantra. The expectation is that your work alone has a say on the STI and not company performance, but that is not the case.
The wind sweeping through the tower heralds a storm rising in the mountain.
STI is a huge nut for AIG To handle each year and now more than ever. When u are not making money it will be one of the easiest this to cut. At some point employee layoffs will not be enough and guess what's next.
So the mistake AIG made was selling STI as a dependable part of compensation and NOT a bonus. Like not a bonus was emphasized.
This was done to smooth the lack of increases.
This message was conveyed for years ie not a bonus but part of you comp you can rely on.
So the issue comes from the expectation AIG set. It will be seen as a take away from emoyees because of the way it was communicated to employees.
The STI is a write off for AIG. They don't match with 401k or anything. My STI range has remained the same for years.
The STI, even at 100% “full strength” kind of blows anyway. Claim adjuster making 90-95K gets a 8.3K STI. And that’s before taxes. Oh and without a promotion (which occurs once every 15 years at this place) the amount never increases.
Even if the STI is given in March 2019, the ELT can easily say it will only be funded at 70-80% due to “lagging performance after unexpected cat losses....etc.” So it’s not exactly engagement ring money.
It's sad because Senior Management gets STI and another bonus every year. They should have to give up their bonuses so the workers that reached their goals receive compensation.
STI can and will be cut at some point. When you are not making money can you afford to keep it. The pension was cut a few years ago without warning to anyone as will the STI.
Why should anyone get a Bonus. The company is not making money 10 out of 13 quarters. What about the stockholder. The stock was at 63 when BD came in now it is at 42. Break the company up, it can not be fixed. 13 year employee
If you feel overworked and underpaid then go to a different employer who may compensate you fairly. Why are you overworking?
As per BD's consultants, the aggregate productivity of the employees is enhanced by such moves. If you think such fear mongering affects your morale then leave. Why are you staying?
Your math on STI is right @VOSdZq5-gqa. however we're already working at 120% capacity.
The extra 20% work plus 10% cut equals 30% down effective income
STI is here to stay. don't jump the gun. anyways, it is not more than 20% of the total comp usually. So, be ok if 50% of 20% is gone. That's just a 10% paycut - Execs will get a deeper paycut if that happens.
alternatively, consultants may advise cut more blokes and make you work 2x for the 50% STI (10% of comp) of remainder folks.
So, weigh it - 100% more work or 10% paycut?
If it's still around you will be luckey to see that. I would bet next year it won't be around