Why would that be a problem?

Is there some rule that everyone at the same company has to make the same amount?

Yes, actually. Large companies have policies about this.

Policies are overridden all the time. Plus, lots of people at Microsoft are paid similarly so it's not as outlandish as it may seem.

They won't be directly employed at Microsoft. Instead they will be employed by a subsidiary owned by Microsoft.

So do you think MS might actually create a new "studio/division", like Xbox is really an entirely separate company?

Probably more like GitHub or LinkedIn, both of which Satya referenced in his Tweet about having experience with this kind of structure.

They can easily just make them a subsidiary that operates under its own rules for now.

It's 300k cash, rest in "profit participation". MSFT has enough RSUs to make that happen without it being a problem

Microsoft is known for paying well below Meta and Google, and OpenAI was paying almost twice as much as the aforementioned tech giants.

So I assume it would be weird to have to make every OpenAI employee a VP or Fellow or something.

They aren’t employed by Microsoft but by a company owned by Microsoft which is free to set their own rules

Stock equivalent in RSUs with a 4-year vesting schedule, as is typical of acquihires.

Microsoft can hire everyone from OpenAI at $1M an year and make no visible difference to its bottom line

This is such an engineer answer. The OP means how does that work given strict compensations policies and pay bands that huge companies like MSFT have and strictly enforce.

"strict compensations policies" and "pay bands" are imaginary hurdles and constraints that corporations put up to control personnel costs.

They can and will totally ignore them, when it benefits them directly. They will also easily find a way to explain why that was okay in case A, but won't be in case B.

This is called “HR”…

And it’s why HR is a piece of useless shit.

If they jump ship to Microsoft, they will just get the salary in the form of RSUs. That's not a problem. There are many engineers who make more than $1M at Microsoft. The salary bands are not really strict, or they just get "staff" in their title.