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McClatchy-Tribune Information Services, Published April 21 2011

Microsoft to increase employees' pay

SEATTLE — Microsoft is making its largest investment ever to increase employee compensation.

In an e-mail sent to all employees Thursday morning, Microsoft Chief Executive Steve Ballmer said, “Today we're announcing changes that will benefit our employees by sharpening the clarity of our performance review process and increasing compensation. These changes represent the most significant investment in overall compensation we have ever made.”

Microsoft declined to comment further on the amount of increases employees would receive, or how much the company will invest in the raises.

The changes will increase how large of a raise employees can qualify for when they go through performance reviews.

Employees now receive a stock award, and some of that award will be converted to cash instead. Microsoft's stock has changed little in the past 10 years, something that investors and employees have been grumbling about.

The company is also changing its performance review system, so employees will be ranked by a single rating system of 1-5, rather than having multiple ratings for different measures.

Ballmer wrote that Microsoft is making the changes to stay competitive in the job market: “The changes we're rolling out today will help ensure Microsoft continues to be the place that top talent comes to change the world.”