Amazon has revised its compensation structure to better reward top performers while tightening criteria for lower performers, reflecting broader trends in Big Tech. Employees maintaining a 'Top Tier' performance rating for four consecutive years will receive increases above their pay range, while first-time recipients will see a decrease in their pay band. This change aims to create clear distinctions among employee performances and ensure steady progression in compensation, aligning with similar measures taken by companies like Google and Microsoft.
Employees who earn a 'Top Tier' performance rating for four consecutive years will now receive 110% of their pay range, exceeding the usual cap.
This approach ensures a steadier compensation progression, referring to the company's total compensation target (TCT) metric.
Amazon's updated model better distinguishes those with consistent excellence from newer high performers.
Overall Value ratings will play a role in how compensation changes are structured this year.
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