Michael Simonds
TRINET GROUPAbout Michael Simonds
Michael Q. Simonds, age 51, became TriNet’s President & Chief Executive Officer and joined the Board on February 16, 2024, after serving as EVP & Chief Operating Officer at Unum Group and previously President & CEO of Unum US; earlier, he was a consultant at McKinsey & Company. He holds a B.A. in Economics and Anthropology from Bowdoin College and an M.B.A. from Harvard Business School . Under Simonds’ first year of leadership, TriNet reported 2024 total revenues of $5.1B (+1% YoY), net income of $173M (-54% YoY), adjusted EBITDA of $485M (-30% YoY), and diluted EPS of $3.43 (-48% YoY); the company’s TSR value of a $100 initial investment was $161 vs. $210 for its peer index .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Unum Group | EVP & Chief Operating Officer | Feb 2020–Feb 2024 | Led all active businesses serving ~40M workers; drove investments in differentiated customer experience via HCM partnerships; expanded voluntary benefits, dental, vision, and absence solutions . |
| Unum Group | President & CEO, Unum US; other management roles | 2003–2020 | Grew Unum US; operational leadership across major business units . |
| McKinsey & Company | Consultant (financial institutions) | 2001–2003 | Strategy and performance advisory to financial institutions . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Various non-profit boards | Board member | Various | Focused on health, education, and financial stability . |
Fixed Compensation
| Component | Amount | Notes |
|---|---|---|
| Base salary (annualized effective Apr 1, 2024) | $1,000,000 | Established at hire; market-competitive . |
| Salary paid (2024) | $890,152 | Reflects partial year from Feb 16, 2024 start . |
| Sign-on cash bonus | $3,000,000 | Subject to clawback if voluntary resignation/termination for cause within 24 months; repayment reduces 1/24 per completed month . |
Performance Compensation
Annual Cash Incentive (2024 Executive Bonus Plan)
| Metric | Weighting (%) | Target | Actual | Payout Impact |
|---|---|---|---|---|
| Professional Service Revenue | 30 | $787M | $765M | Used in scaling; sub-target performance . |
| Adjusted EBITDA | 30 | $568M | $485M | Gate and scaling; below target . |
| Management Business Objectives (MBOs) | 40 | 100% | 99.8% | Near target . |
| Item | Value |
|---|---|
| Target annual cash incentive (pro-rated target $) | $1,327,869 |
| Target annual cash incentive (% of base) | 150% . |
| Actual award (% of target) | 62.6% . |
| Actual award ($) | $831,604 . |
Award scale design: payouts can range 0–200% of target; PSR scales ±10% per ±1% vs. goal; Adjusted EBITDA scales -6.67% per 1% below goal / +4% per 1% above goal; Adjusted EBITDA gate at $483M .
Performance Share Units (PSUs) – 2024 Cycle
| Metric | Threshold | Target | Maximum | 2024 Actual | Earned (% of target) | Vesting |
|---|---|---|---|---|---|---|
| Professional Service Revenue Growth Rate | 1% | 4% | 7% | 1.2% | Contributed to 27% overall | 50% on 12/31/2025; 50% on 12/31/2026 . |
| GAAP EPS | $4.50 | $5.25 | $6.00 | $3.43 | Below threshold | Same as above . |
PSU program design: single-year performance period (1/1/2024–12/31/2024) with multi-year vesting; performance multipliers 0–200% per metric; if MBOs achievement <60% of target, PSU maximum limited to 125% . For 2024, PSUs were determined to be earned at 27% of target .
2024 Equity Grants (CEO)
| Award Type | Grant Date | Number of Units (#) | Grant Date Value ($) |
|---|---|---|---|
| RSUs (annual + one-time mix) | 3/15/2024 | 46,161 | 5,800,130 . |
| PSUs (target) | 3/15/2024 | 62,078 | 7,800,101 . |
Additional one-time awards and vesting:
- New hire RSU: $1.6M, vested in full on December 31, 2024 .
- One-time RSU: $4.2M, vests over 4 years; 1/4th vests on the 15th day of the second month following the 1-year anniversary, remainder in equal quarterly installments, subject to continued service .
- Time-based equity generally vests quarterly over 4 years .
Compensation mix: 95% of CEO compensation is at risk; company prohibits hedging, pledging, and short sales; no excise tax gross-ups on change-in-control .
Equity Ownership & Alignment
| Item | Value | Notes |
|---|---|---|
| Beneficial ownership (as of Mar 28, 2025) | 32,125 shares | Includes 20,408 owned directly and 11,717 shares issuable upon RSU settlement within 60 days; <1% of shares outstanding . |
| Outstanding RSUs (not yet vested, 12/31/2024) | 33,427 | Market value $3,034,169 . |
| Outstanding PSUs (unearned/unvested, 12/31/2024) | 16,588 | Market/payout value $1,505,693 . |
| Stock options outstanding | None | No options outstanding as of 12/31/2024 . |
| Ownership guidelines | CEO 500% of base salary | Officers and Board meet or expected to meet within required time frames; unvested/unexercised awards do not count . |
| Hedging/pledging policy | Prohibited | Employees, officers, and directors cannot hedge or pledge company stock . |
Implications for supply/insider selling pressure:
- Near-term vesting of the earned 2024 PSUs occurs 50% on 12/31/2025 and 50% on 12/31/2026; sizable quarterly RSU vesting cadence plus one-time $4.2M RSU schedule may contribute to periodic selling windows, subject to trading policies .
Employment Terms
| Scenario | Cash Severance | Bonus | COBRA | Equity Acceleration |
|---|---|---|---|---|
| Change-in-control termination (double trigger; within 6 months post-CIC) | 18 months of then-current monthly base salary (lump sum) | 150% of target annual bonus (lump sum) | 18 months of estimated COBRA premium for CEO and dependents (lump sum) | 100% acceleration of unvested time-based awards; 100% of unvested performance-based awards for completed performance periods; if CIC before determination date, performance measured as of CIC (actual if measurable, otherwise at target) and vesting eligible subject to continued employment . |
| Termination not in connection with CIC (without cause / good reason) | 18 months of then-current monthly base salary (lump sum) | — | 18 months of estimated COBRA premium for CEO and dependents (lump sum) | Accelerated vesting of the portion of unvested time-based awards that would vest in the 18 months post-termination; for performance-based awards with completed performance periods (and certified performance), accelerated vesting of the portion that would vest in the 18 months post-termination . |
Additional terms:
- At-will employment via written employment agreement; provides initial base, annual cash incentive opportunity, and recommended initial equity award .
- Clawback policy applies to certain cash and performance-based equity incentive payments in event of certain financial restatements .
- Perquisites: the company may provide tax gross-ups associated with certain event-related taxable compensation (e.g., spouse/partner travel) for executives and employees; no excise tax gross-ups on CIC .
Board Governance and Director Service
- Director status: Simonds is a Director and the Company’s President & CEO; not independent by virtue of management role; he holds no committee memberships .
- Governance structure: Chair/CEO roles are separated; Board Chair David C. Hodgson serves as lead independent director, presiding over executive sessions of independent directors .
- Board activity: Six Board meetings in 2024; each director attended at least 75% of Board and applicable committee meetings; non-management directors held five executive sessions in 2024 .
Dual-role implications:
- Independence considerations are mitigated by a separate, independent Board Chair and fully independent committees; oversight of CEO performance resides with the Nominating & Corporate Governance Committee, while CHCM governs executive compensation .
Compensation Committee, Peer Group, and Pay-Performance Link
- CHCM Committee engages independent consultant Meridian; robust stock ownership guidelines; no hedging/pledging; no excise tax gross-ups; each Board committee is fully independent .
- Compensation peer group includes: American Equity Investment, Broadridge, Cadence, CNO Financial, Conduent, FTI Consulting, Gartner, Genpact, Insperity, Maximus, Paychex, Primerica, SS&C Technologies, Synopsys, Teradata; unchanged for 2024 program .
- Pay versus performance: CEO compensation actually paid (CAP) is aligned with TSR and Adjusted EBITDA trends; CAP for 2024 reflects equity values and stock performance .
Investment Implications
- Alignment and risk: 95% at-risk compensation and PSU metrics tied to growth and GAAP EPS align incentives with shareholder outcomes; 2024 PSU earn-out at 27% signals accountability to underperformance and may lower realized equity vs. grant value near term .
- Supply considerations: Quarterly RSU vesting and scheduled PSU vesting in late 2025/2026 create recurring potential sell windows; absence of pledging and company trading prohibitions reduce forced-sale risk but monitor Form 4s around vest dates .
- Retention economics: Double-trigger CIC with 18 months salary and 150% bonus plus full acceleration of time-based equity provides competitive protection; non-CIC severance provides 18-month bridge with partial acceleration—balanced retention without excessive entrenchment .
- Ownership: Beneficial ownership <1% and sizeable unvested awards indicate incentive leverage is primarily through future equity vesting and performance rather than current stake size; 500% salary ownership guideline requires meaningful accumulation over time .