Netflix will be paying its executives in full, irrespective of the performance by the company, according to Bloomberg. This has been made possible by the new tax law under which the company cannot deduct the performance-based bonuses to managers who get more than $1 million.

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New tax law leads to more salary for Netflix executives

Citing the new tax law, the online streaming company said in a filing on Thursday that the salary of its top executives would increase in 2018. Instead of the cash bonuses, Netflix will now give guaranteed payment to the top executives in the form of salary.

Netflix stated that a salary of more than $1 million was subjected to a significant surcharge. Therefore, the company had performance-based bonuses in place for certain executives.

“With the recent passage of federal tax reform, the performance bonus plan will no longer eliminate such surcharges,” the streaming firm said in the filing. “As such, the compensation committee of the board of directors has determined that all cash compensation for 2018 will be paid as salary.”

Chief Content Officer Ted Sarandos will get $12 million as a base salary in 2018 compared to just $1 million over the past three years, as per the filing with the Securities and Exchange Commission (SEC). In 2017, Sarandos’s salary was $1 million, while his bonus target was about $9 million. Sarandos will receive $14.3 million in stock options next year.

Under the new plan, Netflix CEO Reed Hastings would be paid $700,000 in salary and $28.7 million in annual stock options. Hastings is already a wealthy man, and the new salary will add further to his wealth. The Netflix CEO already made a spot for himself this year in Forbes 400 list of richest Americans. With $2.2 billion, Hastings was at the 359th spot, notes CNN.

Salaries of other top executives have also increased, and have been disclosed in the filing. CFO David Wells gets a base salary of $2.8 million and $2.45 million in stock options. General Counsel David Hyman’s 2018 pay package includes $2.5 million in salary and $3.275 million in stock award, while chief product officer, Greg Peters will get a $6 million salary and $6.6 million in stock options.