Large companies put “golden handcuffs” on their employees. It's a pity to leave with such a contract

One Nvidia employee who plans to leave once his shares are fully “freed up” tells Business Insider that leaving early would come at a “big cost,” adding: — If I wanted to leave now, I don't think I could get the salary I'm currently earning at another company.

It's a tactic that tech giants like Amazon and Google have been using for years to retain employees. Now, as chipmakers sign huge contracts to meet the growing demand for AI processing power, the “golden handcuffs” on the three largest US companies – Nvidia, AMD and Broadcom – are tightening.

Business Insider spoke to six current and former Nvidia and Broadcom employees about the impact of the packages, who are not authorized to speak to the media. Because both companies employ over 36,000. people, with different salary structures, the editorial office also cooperated with Levels.fyi, a website tracking the earnings of employees in Silicon Valley.

Some will have to wait up to four years to receive the full value of their shares. However, the rapid increase in the value of these rewards means that many employees are already earning huge sums – in the case of Nvidia, some can afford to go into “semi-retirement” mode.

— Many have families and are probably thinking logically, “Who am I to give up a job that guarantees my children will never have student debt?” – says one of Nvidia's employees.

See also: Passive income for the middle class. “The range of investment opportunities has expanded significantly” [PORADY]

Employees in “golden handcuffs”

The growth in the value of shares of Broadcom, Nvidia and AMD since January 2023 has outperformed the performance of other technology giants such as Google, Amazon and Microsoft.

— Outside of Meta, even the “worst-performing” AI chip company (AMD) has outperformed the rest of the big tech over the past two years, says Hakeem Shibly, a data scientist at Levels.fyi.

One Broadcom employee, who estimated his restricted stock units (RSUs) were worth more than six times his annual salary, says: “Given the recent share price rally, those who have retained their shares can now look forward to a very comfortable retirement.”

In one case, a block of shares worth PLN 488,000. hole. awarded to an Nvidia employee in 2023 is currently worth over $2.2 million. — according to Levels. Even a more modest RSU package worth 66,000. dollars, reported by a Broadcom employee in 2023, increased to approximately 265,000. hole.

Business Insider spoke with a former Broadcom employee who lost unvested RSUs when he was fired last year. He estimates his vested RSUs are now worth half a million dollars, but If he were still at Broadcom, the entire package would be worth about $3 million today.

In some data submitted to Levels.fyi, the value of stock grants from several Nvidia employees increased by more than 350%. from the moment they are hired in 2023. However, since the shares are not yet fully vested, leaving now would mean giving up over $500,000. hole.

Similarly, at Broadcom, the value of shareholdings of several employees increased by over 300%. as of 2023 — many of them now hold RSUs worth millions of dollars, according to Levels data. Two Broadcom employees said their packages were worth more than $6 million each.

One Nvidia employee said that RSUs triggered “winning the lottery syndrome” — the feeling that it would be difficult to find an equally lucrative offer anywhere else.

“Golden handcuffs are RSUs,” says a former Broadcom employee. “No one will resign now,” he adds.

Stock acquisition strategies attract and retain talent with the promise of million-dollar earnings

Executives at chip industry giants are well aware of what a powerful employee retention tool these packages are.

Nvidia said in its annual sustainability report that “RSUs support employee retention” and said its turnover rate had more than doubled — from 5.3 percent. in 2023 to 2.5 percent in 2025 CEO Jensen Huang boasted that he had made many employees rich, and the company reported that 20 percent its employees have been employed for 10 years, and 40 percent — for over five years.

Similarly, Broadcom reported that its global voluntary departure rate last year was 6.2%, which is “below the industry average in technology.” The company credited stock awards as a “strong incentive for long-term employee retention,” adding that it “has historically awarded these awards to the vast majority of its employees.”

Nvidia employees said that because longer-tenured employees' RSUs are worth more than newer ones, these differences tend to be openly discussed. One noted that some long-serving managers – whose shares are worth many times more – “just sit back and wait for the shares to become theirs.” Another added that people with greater RSUs may be more motivated to exceed expectations—by working harder or disobeying supervisors less often in meetings.

Levels data shows that Nvidia has started to use the method used in recent years by Google, Uber, DoorDash and Pinterest, i.e. the so-called front-loading of the share acquisition schedule. This means that employees receive the largest share of their shares in their first year of employment. Just like a starting bonus, front-loading can be an effective tool for attracting the best talents.

This method also more closely ties financial compensation to performance – as technical employees often receive additional stock after their first year of employment. However, if their results are poor later, they can count on smaller rewards.

Even the smaller stock compensation packages awarded at these AI hardware companies have become extremely profitable. Employees may receive more shares rather than a higher salary or bonus — and for many people working at the chip giants today, that's perfectly fine.

— In private conversations I had with others, everyone is very happy with RSU says another former Broadcom employee.

The above text is a translation from American edition of Business Insider