Smith Barney CLAWBACK wages
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I, like so many others, left Smith Barney earlier this year.
Apparently the new SB comp plan and policy is to do a grid adjustment on final month's comp. So instead of getting a final paycheck for the comm and fees generated month-to-date up to resignation they INVOICE you for a retro grid adjustment. I just got a letter from a law firm they retained to collect the debt or file an arbitraion hearing. This strikes me as unprecedented. Has anyone heard of this or fought through it?I’d have an Atty respond with a letter. I can’t imagine they’d be able to collect on something that wasn’t agreed upon or even put into effect until after you left.
Thats baloney.
They have no idea how much business you would have done the rest of the year. They can only estimate based on what you grossed last year. Sue them back for a stock that went from 57 to 3. And unless it's a pot full of money I doubt they would risk the expense. If I leave I still owe them with a littl more than a year left on my contract. I haven't decided if I will fight paying them back yet or not.Does the clawback have anything to do with fee’s that were refunded to clients? If you were paid on 25k in fees and only 4k was used before they gave refunds I could see you having to pay back your payout portion.
But not if they were paying you a higher grid % and retroactively taking a percent back because you didn't hit the payout bogey's.Are they trying to claw back based on what you were annualizing, or based on what you did till the day you left, and making the assumption that was your gross for the year/
I left a few weeks ago. If i get a letter like that i will send it back, but first i will make it very dirty. And it will smell bad. Real bad.
That’s what is so dirty about it! They are saying that the final grid rate is based on ytd gross not annualized or trailing 12. So they recalc ytd comp and say bang you get no final paycheck and you owe us 20k or whatever.
anyone who chooses to fight that wins. There is no way they get away with that.
I agree with Bob. They only had a portion of the years expenses for you…not a full year. I thinking they are just trying to rattle you. I would go to arbitration on that one.
Well, I have confirmed that SB is indeed claiming “clawback” wages. What a crock of **** , I am so glad that I left last week, and BTW I will soon find out what my first arbitration is like. I want the dollars I just earned, they will “NOT” hold my wages.
Actually, you didn't earn it. You get paid based upon the level that you hit on the grid. At the end of the day, you got paid exactly what you have earned year to date. You are not entitled to a higher breakpoint because you didn't hit that breakpoint. This is not a new policy, they have been paying on a grid system for years.Well, I have confirmed that SB is indeed claiming “clawback” wages. What a crock of **** , I am so glad that I left last week, and BTW I will soon find out what my first arbitration is like. I want the dollars I just earned, they will “NOT” hold my wages.
My team came over a few months ago and we were hit with the severely reduced payout which basically made out final paychecks $0. We have not as of yet been sent an invoice for money owed back... .
We have spoken with a very experienced attorney on this matter and he has reviewed the documents pertaining to the comp agreement. He's recommending we file a class action suit ASAP as he does not believe what Smith Barney is doing will hold up in court. We will be filing shortly. Here's his contact info:
Edward L. Manchur, LL.M. Counsellor at Law Of Counsel to Whittenberg Knudsen, LLP 401 Edgewater Place, Suite 140 Wakefield, MA 01880 781-246-3030 781-246-3050 (fax) [email protected] Hope this helps!My team came over a few months ago and we were hit with the severely reduced payout which basically made out final paychecks $0. We have not as of yet been sent an invoice for money owed back... .
We have spoken with a very experienced attorney on this matter and he has reviewed the documents pertaining to the comp agreement. He's recommending we file a class action suit ASAP as he does not believe what Smith Barney is doing will hold up in court. We will be filing shortly. Here's his contact info:
Edward L. Manchur, LL.M. Counsellor at Law Of Counsel to Whittenberg Knudsen, LLP 401 Edgewater Place, Suite 140 Wakefield, MA 01880 781-246-3030 781-246-3050 (fax) [email protected] Hope this helps! GI don’t know how their grid works, but it sounds as if what they are doing might be legit.
With my B/D, one's payout level is based upon GDC and it is from the first dollar. Ex: Joe is a new rep. He starts at a 40% payout. When he does enough business, his payout gets bumped to 50%. Additionally, he will get an extra 10% on all of the business that he did when he was still at 40%. If he hits the 60% payout, he'll get an extra 10% bump on his previous business. The same thing happens when he hits 70%. Let's assume that he ends the year at 70%. He can start the next year with a 70% payout. The catch is that much of this payout is paid before it is earned. If Joe only does $50,000 GDC and that keeps him at a 40% payout, he'll have been paid $35,000 ($50K x .7), but will have only earned $20,000. He'll owe the B/D $15,000. It doesn't matter if the reason is that he had a sucky year or if he quit after a month. Is this the clawback?Yes.
The issue is the comp plan does not specifically say this. It alludes to it but never comes right out and says it. Also, the fact that it's NOT enforced on everyone who leaves works against them. When the attorney read through the comp plan he felt there were major issues with this.
Anyone who has left our SB office in the past year has had their final paycheck withheld, not just clawed back.
Anyone have any updates on their situation and how it's being handled? I am curious as I am 2 weeks removed from SB and I am sure my call is coming. I just received a paystub with no earnings for the month, but haven't heard anything else.
Do they completely change your YTD earnings and back out your 401K contributions? Seems like that would definately be illegal especially after the JV took place and we supposedly were all terminated on June 1. Regardless I can see myself being part of the class action. I would appreciate anyones feedback as to their circunstances and whether you had any resolution.Seems to me a good part of this argument would be favorable to anyone that left after the JV took place. Advisors were terminated and then rehired, payouts on the 401K and pension plan are taking place and paystubs started at zero. If they clawback people that left they would have to clawback those that stayed that didn’t produce enough in 6 months to hit the grid.
I could see the point of being on a reduced payout for anything after June 1, but nothing prior to the JV...that company is gone.Smith Barney sent a folded letter announcing the merger with Morgan Stanley along with the April statements. On page 4 they said they would waive transfer fees for any client who did not wish to have their account transferred to Morgan Stanley Smith Barney if they notified the firm before May 30.
I resigned on May 15th. Clients who followed me and complied with their very explicit instructions(which involved a sending a letter to NY) were STILL charged transfer fees. Did anyone else experience this? Please email me. I am looking for others who were caught in this. By the way I had 50 days left on my contract and left early only so my clients wouldn't have to pay the termination fee. They are filing for a year's worth of my 7 yr forgiveable loan."They are filing for a year’s worth of my 7 yr forgiveable loan. "
Thats standard procedure, they helped me get a note form UBS prorated years ago, I think you will find that you will only be due whats left of the 55 days.