Role-Based Pay Watch ’14: Goldman Sachs

Goldman Europe sees your bonus caps and raises you this:

To navigate bonus caps in Europe, Goldman Sachs will offer a new kind of pay class for bankers in Britain and on the Continent, a person briefed on the company’s plans said. Call it the third way of pay. Starting this year, certain Goldman employees will earn a salary, a bonus and some “role-based pay.” It may be paid monthly or divided, with some paid monthly and some accruing to be handed out at the end of the year. The new type of pay will not be used when tallying pension contributions. The bank may be able to claw some of it back, and it can change from year to year. But it will have the effect of driving up base salaries…Role-based pay, which Barclays also plans to use, is a response to bonus caps passed by the European Commission for employees unceremoniously labeled “code staff.” Code staff includes those engaged in risk-taking and in control functions, senior managers and employees who make over 500,000 pounds ($820,000). Starting in 2014, bonuses for code staff are limited to 100 percent of an employee’s fixed salary, or two times salary if shareholders approve it.

For Goldman in Europe, a 3rd Way to Get Paid [Dealbook]

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15 Responses to “Role-Based Pay Watch ’14: Goldman Sachs”

  1. investorcluzo says:

    disappointed when I found out this wasn't a story about role "play"…
    -guy skimming headlines

  2. Man Financial says:

    Paid for production. Basically they are all becominb large brokerage models.

    IE , I had a good month

  3. Guest says:

    – Activists complain about executives making too much in salary
    – Governments pass hard caps on salary
    – Corporations shift compensation to bonuses
    – Activists complain about executives making too much in bonuses
    – Governments pass hard caps in bonuses
    – Corporations raise salaries for executives and/or move to another country
    – Activists claim success, cycle repeats

    Allow me to propose a more efficient alternative:

    – Governments ignore how much executives make and how much activists cry about how much executives make
    – Governments wait for companies to fail, then take them over and fire management
    – Governments sue former managers for misrepresenting the firms' finances, leaving them out of a job and bankrupt
    – Salaries and behavior adjust to reward more prudent management of firms

    • PippyLongSausage says:

      Take your rational analysis and shove it up your ass

    • Dodd Frank Quant says:

      Don't forget, government requires proxy disclosure of executive pay compared to peers -> Executives demand they be compensated better than their peers.

  4. Gulp Friction says:

    Bring out the Grundle Gimp!

  5. Big Hank P says:

    What is the role-based pay for chief bailout arranger?

  6. Guest says:

    no way. did ARS get this from Matty Levine's scoop?