Google downplaying wealth

SAN JOSE, Calif. — Long before Google minted thousands of millionaires, executives recognized sudden riches can transform a company's culture.

They'd watched other companies struggle as workers fixated on the stock price, tensions grew between the haves and have-nots and morale flagged.

To avoid a similar fate, Google started planning early. From the outset, co-founders Larry Page and Sergey Brin downplayed talk of an initial public offering (IPO) to keep employees focused on building the business, not on a potential stock payoff.

They also developed an elaborate matrix to determine how many options each type of worker would get in an attempt to meter the flow of options and to maintain a fair pay structure.

Shortly after the IPO, Google cut back on its use of stock options by 75 percent but started mixing in restricted stock units, a variation of stock that accrues over time.

Unlike stock options, which can slip "underwater" if the stock price later falls below the grant price, these stock units always have value because they're worth the current stock price.

"It's almost viewed as guaranteed money," said Stacy Savides Sullivan, Google's chief culture officer.

This month, Google plans to unveil an innovative "transferable-option" program that will let workers auction off their options to outside investors.

That could offer relief to workers currently sitting on 1.3 million underwater options that were priced in November, just shy of Google's all-time peak of $510.

Google also is drawing up plans to strengthen its 401(k) plan in another bid to retain workers.

As the old saying goes, though, money isn't everything.

"If I say I'm burned out, pay doesn't fix my burnout," said Fred Whittlesey, who heads Compensation Venture Group in Seattle.

"Pay doesn't fix the fact that I'm tired of working in a big company. Pay doesn't fix the problem of saying, 'I'm tired of being an engineer.' You can't just throw more money at them," Whittlesey said.

Recognizing that, the company will conduct its fourth "happiness survey" in the summer to measure whether Googlers are still having fun at work.

And it has implemented a range of more touchy-feely tactics that helped Google rank No.1 on Fortune magazine's annual list of the best companies to work for.

For example, Google offers generous maternity and paternity leave, buys meals for parents of newborns and soon will formalize a policy for workers who want to take off for an extended stretch.