Termination Language for U-5

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Sep 20, 2010 1:32 am

I am an ABM for a major wirehouse and need to let some trainees go for failure to meet their production goals. I have heard that when Merrill let several hundred less tenured FAs go in 2008 during the BOA merger, many were released for "failure to meet performance standards"' which in my opinion does not really articulate the fact that at that time it was darn near impossible to meet goals and gather assets at Merrill.

I don't want to jeopardize my trainees chances to move on to an independent or bank environment as the production goals are essentially 250K in trailing 12 by year 4 and many are very close.

My question is, do indy firms (LPL, Schwab, etc.) really look at the u-5 for this sort of thing (if otherwise clean), and is there a kinder, gentler way to phrase a termination for folks who have done an admirable job in a tough environment...200K in year three is not all that bad.


Sep 20, 2010 12:15 pm

What you quoted is not going to be a problem for these folks. Hiring managers are smart enough to know what the markets have been like. It's nice to hear you show some compassion, in my nearly 20 yrs, I've seen both sides of that issue. Encourage these folks to continue their careers if they really believe that they belong in this business. Most major banks have investment programs that are aggressively hiring right now. That was the option I took back in the late 90s, after stumbling around for a while. At first I thought it "beneath me", but I was wrong, and my career took off. Bank programs are not all created equal, and I'd personally suggest that Wells is probably the best right now, with US Bank most sincere about creating a better program. I know lots of former colleagues with both places. For me, I went Indy after my big bank got blowed up real good... Hope that helps.

Sep 20, 2010 5:25 pm

It's a fact that when you are hired has a lot to do with if a trainee is successful or not. Obviously, bull markets help make trainees successful, bear markets make it tougher to succeed. We have written on this many times.

Check out these two articles on FA success. http://bit.ly/awG7IO and http://bit.ly/9iGccn

Sep 21, 2010 10:58 pm

 If he's a 200K producer and everything else is clean, he'll have no trouble getting onboard with someone.

Sep 22, 2010 11:37 pm

Thanks for the insights/help. It is much appreciated....I like the guy's work ethic and want to see him succeed...just handcuffed by complex production numbers and litte flexibility.

Sep 23, 2010 5:45 pm

The two of you should open an indy office