The pay-cuts across Apple's executive team reflects the company’s first decline in revenues
Published By: Patrick Arruda on January 8, 2017 08:33 am EST
Apple Inc.’s (NASDAQ: AAPL) CEO Tim Cook, among other top-level executives, has been docked his pay by about $1.5 million, as a result of Apple missing its annual sales targets for 2016. Other executives to face a pay-cut include Chief Financial Officer Luca Maestri, Senior VP of Internet Software and Services Eddy Cue, and general counsel Bruce Sewell among others.
Part of the compensation package devised for Apple’s top-brass is cash rewards based on performance, and that is where the dock in pay has come into effect for the company’s top-level executives. Therefore, it was revealed in an account to the Securities and Exchange Commission of U.S that “this performance resulted in a combined payout at 89.5 percent of target for each named executive officer,”.
It was also noted that the payout under performance-based incentives was “significantly less” than that paid out last year, as a result of “strong pay-for-performance alignment” in the contracts that was observed during 2016. Cook’s basic salary stands at $3 million for 2016 but the total compensation reaches $8.7 million, which is $1.5 million less than 2015.
As for the reason in numbers for docked pays, Cook has to make sure that the next time annual sales and income are reported, they don’t read Net Sales down by 7.7 percent and Operating Income down by 15.7 income, as they did for 2016, which makes it a year to forget for both Apple and its top execs.