Working in Arm's engineering team? You're probably happy with your pay rise

But some staffers fared better than others

Arm has agreed a pay increase for employees following the scrapping of a wellbeing allowance last year, yet it appears that while engineers were offered an 8 per cent jump, other types of worker fared less well.

As revealed by The Register in May 2021, Arm ended its FlexPot scheme, an annual allowance granted to employees and fixed-term contract workers, a move seen by some as effectively being a pay cut.

The chip designer had also imposed an engineering hiring freeze that meant departments around the world were blocked from hiring new staff, even to fill any vacancies caused by employees leaving the firm.

The hiring freeze was expected to last until the current owners Softbank sold Arm to US chipmaker Nvidia. At the time, this was anticipated to be done and dusted by April 2022, however the sale is delayed due to regulatory concerns and doubts were recently cast over whether the transaction will even go ahead at all.

Perhaps in response to the delays, Arm CEO Simon Segars wrote to staff late last year saying he has spoken to Softbank about rewards.

"This was in the context of the demand for Arm talent and the pace at which wages are increasing, and it is also something that many of you rightly raised as an area we needed to look at," he said in the email that was seen by us.

As an extraordinary pay rise – and in advance of an Annual Pay Review in April – staff were given a salary increase for 1 January "based on wage inflation in their location, the type of work they do and the level of competition for their role in the market."

According to company insiders, Arm agreed a pay increase of 8 per cent for staff working in its engineering teams. Research teams were offered 6 per cent, and those working in IT, administration and finance got 4 per cent.

Many will regard it as only natural that Arm should reward most the engineering brains that the company depends upon for its continued success, especially during a difficult period when some might be tempted to jump ship. However, it seems that some employees at the company believe that this is a tactic which penalises lower paid employees, for whom the loss of FlexPot has had a greater impact.

"Arm engineers are relatively well paid," said a source close to the company.

Before cancellation, the FlexPot allowance stood at £4,500 per person for UK staff, and $8,500 in the US. This could be used to support an employee and their family's health and financial wellbeing in any number of ways.

In a statement, the company told us: "Arm operates in an industry where competition for talent is intense, and our people are core to our success. Arm regularly reviews employee reward and makes updates as needed to ensure that our package is competitive across locations and job types."

According to the email from Segars: "The Annual Bonus remains with the current design of 100 per cent maximum company performance, and we are tracking towards achieving this... this is the first in a series of reward updates. In addition to our usual Annual Review, Annual Bonus, Partnership Awards and Partnership Award Accelerators, there will be further updates."

Segars signed off by saying: "Arm is an incredible company with a bright future. I know it's been a tough year, but we've achieved great things together, our strategy is working, and our partners want more and more from us."

Meanwhile, the situation at Arm has now attracted the attention of union Unite's Cambridge Engineering Branch, which claims that with the UK retail price inflation (RPI) measure currently somewhere in the region of 7.1 per cent, a pay increase of just 4 per cent actually represents a real-terms pay cut for those employees that have been offered this amount.

In a Facebook posting that seems aimed at recruiting Arm staff, Unite lays out its official grievance and states that it believes all employees should have been awarded an 8 per cent uplift, taking into account the loss of the FlexPot scheme and the impact of inflation on the cost of living.

All in all, it looks like 2022 will be an interesting year for Arm. The firm may or may not be sold to GPU giant Nvidia, and if that deal falls through, it may or may not be spun out by current owner SoftBank through an IPO. On top of all this, it looks like it may have to contend with disgruntled employees. ®