There’ve been many reports about London Lehman employees getting screwed over when it comes to severance, but apparently some lucky New Yorkers are getting the royal treatment as well. From a Laid Off Lehman Sister:
I left Goldman Sachs to work for Lehman Brothers thinking that they were the classiest of the 2 firms in way of respect. For the first 8 months, I was correct until I was laid off last week and was FIRST told I would have severance until Dec 15. When I called back after the Barclays deal, they said October 3rd. Then when I called today, they said that last Friday was my last paycheck, NO severance. This is the most horrific incident I have ever heard of a firm doing to well over thousands of employees.
And another:
I was laid off Sept 10 and promised a generous severance. I basically live pay check to pay check so the severance package was my security to pay rent, bills and insure proper time to find a new job. I have little in savings as I’ve been paying down my debt for the past year.
Now I’ve been told that the company doesn’t know if they are going to pay out what was promised to me. They said my last paycheck was on Friday and they are not sure if I will be receiving another one. So basically I’m in a holding pattern and at the same time unable to apply for unemployment.
It amazes me that certain management who stayed (to go down with the ship) at Lehman and even promoted weeks before the chapter 11 filing were enticed by bonuses to stay. Yet the company can’t even keep their commitment with former employees who were the backbone of that company. Instead HR keeps saying- call back, we don’t know a thing keeping ‘us’ blowing in the wind wondering if ‘we’ will get the severance that ‘we’ deserve.
what are the associate numbers?
Well Bess even if you weren’t able to help that girl from this weekend…sounds like plenty of people are getting fucked in the building.
8 months & no severence? Boo hoo. Welcome to the real world.
@ That is hilarious…
@ 1 That is hilarious…
Blythe Masters sees things slightly differently. In a brief email exchange with the Guardian, she said: “I do believe CDSs [credit default swaps] have been miscast, much as poor workmen tend to blame their tools.” This is an well worn comment on her ex husband. She has been very content with molded plastic for years thanks
@4 and 5 – please go back to pumping and dumping on yahoo finance.
Yeah boo fucking hoo. Should have gotten a real job in the first place. Why the fuck should anyones tax money be spent on her severance?
Why pay low-level slaves anything when you can “wall-off” $2.5 billion (according to the NYTimes) for bonuses for the more truly valuable senior managers? Bend over…grab your ankles…relax…keep telling yourself – “this is enjoyable” (at least for the senior managers getting the dough).
This is a joke, right? Less than a year and she’s whining? She probably just barely accrued some vacation time.
seems a whole lot of people are hurting.
really i feel bad for you but that is the best i can do.
it’s not as if there hasn’t been poor people before.(i have ALWAYS been in that group)
just more of them now.
bless all of you and keep your chins up.
@8 severance / any pay would come from barclays…
Why can’t she apply for unemployment? It sounds like she was laid off before the BK. Does severance mean no unemployment?
it can disqualify you, depends on the situation.
@10 the people who should be crying are the ones who lost stock that hadn’t vested. All for nothing that was. Not even a chance to sell it.
This lady should look up the meaning of the terms “bankruptcy” and “unsecured creditor”. After all, she does work in finance.
Boo fucking hoo. Move back to your parent’s basement and get a real job.
So where is the money set aside for the bonuses?
Also re: “I was promised” …
Life lesson: Get it in writing.
From another UK article about LEH that I read:
“In addition to the $2.5bn cash pool, Barclays is also in negotiations with about 30 executives it considers to be Lehman’s best assets and plans to offer them contracts worth tens of millions of dollars.”
Those “30 executives” are the ones who NY AG Cuomo should invite to the Rikers-Island Hotel for several nights of ass-banging fun after the judge (Cuomo’s friend) denies bail. You know, someone said, “You find me the man, and I’ll find you the crime.”
I’m no fan of Wall St, but taking care of “Lehman’s best assets”, and throwing the rest of LEH’s workers overboard is grounds for violence as far as I’m concerned.
The Guy from Delaware
There is some woman on CNBC right now talking to people as though this new bill was already a done deal.
…perhaps if you’d mastered English grammar — no, on second thought, unlikely to have helped you.
You should have went to law school instead of business school.
@ 15
5 years for LEH?
To the few douche bags here that try to make fun of other people’s misfortunes, or simply comment on their situation with derision; hope that something like this happens to you in the very near future. After all, if you work in Wall Street you could be next.
You know who you are.
@25
Deutsche Bank will never go down!
Go die in a fire.
Can anyone explain to me what this means in the scheme of things? If you can, thank you.
“Then my pal “The Bond Dude” called to say “You missed it – ever so slightly.” Oh-oh…being in no condition being sleep deprived, I made him explain slowly what I missed: “When you’re talking about the Private Sector Coinvestment idea, that’s on the front end – before the government money goes in, so that as soon as the private guys make their slice, they will take out the public 90%. In other words, it’s a buy-in on the front-end, not the back…”. OK, that’s making sense.”
http://www.urbansurvival.com/week.htm
@24 RSUs = 20% immediate 80% vest in 5 years
I believe the RUSs are awarded at a discount (25-30%?) to the close on some date in October. You have the option to cash out 20% immediate with short term cap gains tax in force.
Worst case 100% of RSUs lost, best case 80%, since 2003. Any case. The only way to cash out the RSUs early was a clause stating that if there was a hostile takeover threat all the RSUs would go unrestricted. That was Dick Fuld’s “Shark Repellent” philosophy.
Lotta people lost a lotta dough. Goldman has a huge amount of restricted stock as well. I don’t know Morgan employee’s situation.
#28 here. Lehman RSUs were (are?) non-voting. So If a company tired to buy controlling interest in the open market the RSUs were to be turned loose to make the takeover much more expensive. A lot of people might have held LEH in hopes that worst case would be a takeover at a premium. That’s called drinking the Kool-Aid. Not listening to Enron.
diablo – douche touche!
just one grammatical note — that should be a colon, not a semi-colon after “derision”
@30
What are you? The Grammar police? Go fuck yourself.
@31
This is the central scruuutinizer! Here to monitor folks that break laws that have not been created yet… Learn some fucking grammar!
i do not see what the difficult problem is here. Remember the airlines, when they went bankrupt most discharged all their pensions to the federal gov. Then the high level suits got bonuses. The rest of the employees either were laid off with no severance or very little.
What is it you do not understand about bankruptsy? Creditors and bond holders first , the rest take a hike. Life is not fair, etc ….
Principal vested over three years and were then subjected to a post vest hold period of two years (total five). Discount vested over five years and were delivered together with Principal portion five years after grant. So no 80/100 split for employees. You lost everything that was granted as part of complensation from 2003 to 2008. Employees were also restricted from hedging vested portion of equity awards so no put buying on vested shares.
Principal vested over three years and were then subjected to a post vest hold period of two years (total five). Discount vested over five years and were delivered together with Principal portion five years after grant. So no 80/100 split for employees. You lost everything that was granted as part of complensation from 2003 to 2008. Employees were also restricted from hedging vested portion of equity awards so no put buying on vested shares.
Principal vested over three years and were then subjected to a post vest hold period of two years (total five). Discount vested over five years and were delivered together with Principal portion five years after grant. So no 80/100 split for employees. You lost everything that was granted as part of complensation from 2003 to 2008. Employees were also restricted from hedging vested portion of equity awards so no put buying on vested shares.
Very fishy. First, there was absolutely NO confirmation of what severance was likely to be. Some numbers were thrown around (including in the initial Barclays email which mentioned both 3 weeks and LEH scheme) but nothing was confirmed.
Also, the no severance thing is also unconfirmed. As of now, the leading opinion seems to be that laid off people will get the lehman severance – which is 3 weeks for every year served plus some other lumpsum linked to last year’s bonus. I dont know who this person called but I have asked some fairly senior folks and no one has a fucking clue.
Also #33, employee severance doesn’t come after ALL creditors, it is the at the same level as the unsecured creditors. Yes, life is not fair. come to think of it, most of us in this industry earn multiples of what our friends in other industries do. It is a high-risk high-return business, you cannot simply keep cashing in on the rewards without the risk hitting once in a while.
This same person would have gone home with a fat bonus at the end of the year (had things been normal) and never batted an eyelid about how ‘unfair’ it was that she was getting such a high amount while others were not. Not that I am against people earning as much as they legally can (I also do) but I think the person above needs to view life in a different perspective than that of a poor victim.
I also may get very little severance. But hey, shit happens and you always get another shot!
Thanks 34, 35 and 36. All clear now.
This entire episode is horrifying. I understand the importance of retaining talent. And that Wall Street is a nasty place that takes no prisoners. Got it. Strongest survive- if you can’t deal then get into a different business. However- the small amount of money (percentage wise) it would cost this firm to do the right thing by the employees who were literally mauled by this bankruptcy is insignificant- and that is an exceptional understatement. After all of the terrible mistakes made at Lehman and on the Street in general which have brought us to the nightmare we are currently living- just do the right thing here. I’m sure the brilliant talent being delivered truck loads of cash to stay on and keep some semblance of the Lehman ship afloat won’t miss the relatively minuscule amount of cash needed to go towards rent and expenses while these people search the mangled job market for a job. NO matter how jaded and cynical the readers of this blog are (me included!) it must be clear that the right thing needs to be done here.
@ 28 and 34
My understanding is LEH awarded RSUs as a higher % of comp than other banks. 50%?
Who leaves GS for LEH? That kind of decision making doesn’t deserve severance.
my understanding is that no firm is required to pay severance, as shitty as that sounds,,,severance is usually awarded as an act of “generosity” for most firms,,however, most employment contracts are “At will”…
#42, You are wrong. Some minimum severance is part of your employment contract, of course pursuant to some other criteria being met.
Many times the employer may grant you more than what the minimum guaranteed is (like in the case of BSC) but nonetheless, you are entitled to the minimum by virtue of having signed a contract (unless none was mentioned in the contract.) From what I know, most banks have severance clauses in place.
You only worked at Lehman eight months – why are you expecting any severance at all? Ninety-nine percent of companies would give you jack shit, in fact they would probably make you pay back your relocation bonus that you got when you signed on.
-$$$
Well, they could always buy one of the shirts at http://www.longlehman.com
they say “i worked for lehman and all i got was this lousy tshirt” hahah :(
Bush wanted to privatize social security. Swap $700 bil for a % of the US financial services industry. Basically accomplishes his goal, no?
I am hoping that the dead souls who posted comments to the effect of “boo fucking hoo, get a real job” to the laid off Lehman employees are 17 year olds deep into meth, too young, too stupid, and too addled to know any better.
Bankruptcy complicates everything. Unpaid wages have priority, but I’m not sure severance pay is categorized as unpaid wages.
Yes, you get severance if it is spelled out in an employment contract; otherwise, you have no entitlement to it. And if your company goes into bankruptcy, that employment contract is put into a pile with all the other contracts that are being broken because there are not adequate assets to pay them all. Take your complaints to the bankruptcy trustee, and by the way, be sure to take a number.
I worked 14 years as a high level “at will” employee. One day, the guy in charge, who superficially projected kindness and charm but had a deep paranoid streak, asked for my resignation. No notice, no severance. My severance was my accumulated vacation pay and my 401(k) plan. By the way, I was 53, and had a kid in college. Great time to start over.
I’m not asking for anything from anybody. I took my losses and picked myself up and kept on working. I’m just asking the idiots who are mindless enough to rub salt into the wounds of blameless people consider for a moment that one day, it could be one of them standing in that position. Show some respect.
By the way, to the Lehman employees who aren’t receiving any more paychecks and are in the dark as to what to do next: go file your unemployment claim. The unemployment checks can always be suspended if your income resumes. Let the unemployment office and the bankruptcy court be the ones who worry about it. It takes a few weeks for the unemployment checks to get started. Why wait longer than you have to just because your former company is a smoldering pile of ashes in the bankruptcy court?
Whaaa, I don’t get the severence, whaaa
This is misfortune? Let me see your tax returns for the last 5 years, and compare with what 99.9999% people on earth made…some misfortune
Come join the real world american fucks, the time has come.
@31
Just because you’re knee-jerk nasty and poorly educated doesn’t mean you can’t be grammatical. That should be a comma after “you”, not a question mark.
@48- no it hasn’t, we’ll always be better than you. You think it’s just luck, right? Well, that’s why you’re always going to be an also-ran.
@47 – well put, completely agree. a lot of schadenfreude on this site right now. what goes around, comes around haters..
@49: When you simulataneously use a comma and a quotation mark, the comma needs to come first, e.g. That should be a comma after “you,” not a question mark. Don’t worry, you will learn these things in 5th grade.
The grammar rules have changed. Have had more than one discussion with a newly minted ivy league grad who ultimately brought me in the style sheet of the university. It proved to be a fascinating read.
Dear everyone,
Suck it. I have two Ferraris.
Love,
Eric Felder
52 actually, that comma-after rule is like “who” and “whom” – the later considered stilted and old fashioned, the former totally acceptable.
@49
Actually, the rule you quote on quotes is not a rule. It is an American typsetting convention, sorry to say, not a rule of punctuation. As such, it is seldom observed anywhere outside 5th grade (or 4th grade to those of us in advanced placement) — if, that is, it hasn’t already been consigned to the dustbin of irrelevance. You would be well advised to unlearn it along with other tiresome, useless pedantry you are doubtless still carting around.
@56
you were responding to @52
c’mon, keep up
mayo for severance?
After going down on the Good Ship Drexel
Burnham Lambert back in 1990, my promised
severance was held up by the bankruptcy court. But I got most of it about a year later.
–kleeneth
I am #3. I’ve been in the *exact* same situation. Employed for 11 months, then laid off. Right before I was owed a bonus to boot.
I didn’t cry about missing either the severance or a bonus, neither should the person referenced in the thread.
3sWBDi I am so grateful for your post.Thanks Again. Really Great.