Some IT pros could score a signing bonus and restricted stock shares.
The tide is turning in favor of job seekers, but don’t get your hopes up that potential employers will woo you with benefits packages including country club memberships or piles of stock options.
“The market is back and things are more competitive,” says Paul Groce, partner and head of the CIO practice at executive search firm Christian & Timbers. “But companies remain conservative,” he says.
In 1999, IT professionals could expect both a big signing bonus and stock options. Today IT executives might be offered a signing bonus intended to cover specific losses they might incur by leaving their current job, Groce says. It also is more common for employers to offer restricted shares rather than stock options, though midlevel IT professionals interviewed by Network World generally are not having either type of incentive dangled in front of them.
Instead, network administrators are being courted with training incentives, better paid-time-off (PTO) packages and flexibility. They probably are shopping carefully: According to Network World’s 2006 Salary Survey, benefits are second only to compensation as an influence on job satisfaction.
The CIO crowd
There are many reasons why companies are shying away from offering lavish perks, Groce says. Some have to do with regulations such as the Sarbanes-Oxley Act. That’s not to say employers aren’t trying to make their opportunities appealing. “Companies are getting more competitive and putting together more attractive packages for employees,” says James Del Monte, president of JDA Professional Services, an IT recruiter in Houston. More companies are offering signing bonuses as a way to attract talent but not commit to higher salaries long-term. The bonuses are being offered upfront and after 90 days of service, Del Monte says.
If a company decides to hire a job candidate who would be walking away from thousands of unvested shares, it might offer that candidate a signing bonus close or equal to the value of the unvested shares, Groce says.
Stock options scandals have put the kibosh on offering them to new employees. “A greater balance [of new hires]are being offered restricted shares,” Groce says.
The biggest distinction between stock options and restricted shares is ownership. Back in the day, a company might have offered new IT executives 10,000 stock options, which let them purchase stock at a future date based on its value when they were hired. If the stock price had been $5 per share when the options were offered and the stock later was selling at $15 a share, employees would have a nice windfall. However, they would still have to lay out $50,000 to cash in. Also, the stock could have declined in value or be nearly worthless, meaning the options weren’t much of a perk at all. Restricted shares, typically offered in smaller chunks, belong to employees once they are fully vested.
One IT executive who is expecting to make a career move in the next two months hasn’t seen many signing bonuses offered. He asked that his name not be used because his current employer doesn’t know he’s on the prowl for a new gig. He expects a future employer to reimburse him for broadband service at home and on the road; if he has to move to accept a new job, he’ll ask for relocation costs. “The fringe of having a cell phone with data support and a laptop seems pretty reasonable,” he says.
Midlevel IT managers
IT employees below the CIO level might be offered signing bonuses, but whether they should expect one depends on their skills, Del Monte says. A Java developer could be offered a signing bonus while an SAP expert might not, he says.
Dot Foods doesn’t offer IT employees signing bonuses, but it does offer a bonus program based on the company’s service and profit-level goals, says Benjamin Story, network administrator at the $2 billion food redistributing company based in Mt. Sterling, Ill. If both goals are hit quarterly, employees will be looking at a $600 bonus, he says. The company also offers IT employees a “super bonus,” based on delivery times for application projects within the IT department. Dot Foods is not a publicly traded company, but employees also are offered profit-sharing.
Another tool used to attract midlevel IT personnel is offering PTO that extends beyond the typical two weeks. That’s a big perk for new hires at The Reinvestment Fund (TRF).
“We’re a privately held, nonprofit company . . . but the benefits package the organization offers is generous,” says John Page, CTO at TRF, a financial services firm in Philadelphia. To attract experienced employees, TRF figures in half of new hires’ industry tenure in calculating vacation time. For example, Page had spent 18 years in IT when he joined TRF. The company figured out his PTO as if he had worked for there for nine years, which gave him 31 days of PTO on the day he began work. “That feature in of itself is unheard of, and we market that as a way to attract talent.”
Nonprofits admit attracting employees is difficult because they can’t always offer the most competitive salaries. Florida’s Hospice of Palm Beach County tries to compete based on perks such as flextime and telecommuting. Richard Hernandez, IT supervisor, attributes the low turnover in the IT group to the department’s flexibility and positive working conditions.
Brookfield Homes also is considering hiring new IT employees. Eric Simon, vice president of IT at the Fairfax, Va.-based construction company, is bringing in two entry-level employees to focus on desktop and Web development and one IT manager. Brookfield Homes is offering fully paid training in addition to the standard set of benefits. “It makes my job easier to have employees up to speed on the latest technologies, but it also makes them feel better about themselves and the job they’re doing,” Simon says.
