Tesla chief executive Elon Musk has revealed why the electric car or truck maker does not make any matching contributions to its 401(k) strategy. In the United States, a 401(k) is a common firm-sponsored retirement account that workers can contribute a percentage of their salary to. Employers can make matching contributions – a thing which Tesla has selected not to do for 3 years operating, reveals a report from Pensions & Investments.
Journalist Stephanie Ruhle quoted the report even though tagging Elon Musk and asking why Tesla seems to be unwilling to match employee 401(k) contributions even though paying billions to Mr Musk – who not too long ago dethroned Amazon’s Jeff Bezos to turn into the world’s richest particular person.
“What am I missing?” asked Ms Ruhle on Twitter. “Tesla has paid @elonmusk billions & they are unwilling to match employee 401Ks?”
Elon Musk, 49, responded to Ms Ruhle’s query and revealed that all Tesla workers obtain stock choices.
“Everyone at Tesla receives stock. My comp is all stock/options, which I do not take off the table. That’s what you’re missing,” he wrote.
Everyone at Tesla receives stock.
My comp is all stock/choices, which I do not take off the table.
That’s what you are missing.
— Elon Musk (@elonmusk) February 9, 2021
The billionaire’s response to the query was ‘liked’ more than 60,000 occasions on the microblogging platform exactly where he has more than 46 million followers. Reactions have been mixed – with some Twitter customers praising the compensation strategy and other folks criticising it.
Ms Ruhle herself remarked on the “beauty of Twitter”, saying that the platform permitted men and women to get direct answers from businessmen who would otherwise be unavailable for comment.
“That is a win for all employees & a great way to keep everyone incentivized to be there & optimize productivity,” she wrote prior to asking additional concerns on how the compensation strategy is structured.
The beauty of twitter-finding the answer direct.
That is a win for all workers & a good way to retain absolutely everyone incentivized to be there & optimize productivity.
How is it structured?
If it really is “share based comp”, does that count as an expense then added to adjusted earnings?— Stephanie Ruhle (@SRuhle) February 9, 2021
According to news web page Electrek, Tesla delivers stock choices and grants as element of its compensation package to all workers. Unlike most other automakers, the firm gives stock choices to all its workers, and not just these in management.
Because of this compensation strategy, Tesla’s meteoric rise has helped make lots of of its workers incredibly wealthy, with lots of of its prime executives owning stocks worth millions.