Barclays handed out pink slips instead of year-end bonuses, firing 15 New York-based bankers and traders just weeks before the holidays. Adding insult to injury, the UK-based bank denied the fired employees their annual bonuses—typically a significant portion of their compensation, as per the sources reported by the Post.
Coal instead of cash
Among the 50 employees let go last month, these 15 Wall Street professionals saw their expected windfall vanish. For context, investment bankers often earn a $200,000 salary paired with bonuses reaching up to $1 million, according to insiders.
“A good employer will pay the bonus pro-rata for the time worked during the year, but some don’t,” noted Tanvir Rahman, an attorney at Filippatos, calling Barclays’ decision “heartless.”
Rival banks like Goldman Sachs and Bank of America reportedly offer partial bonuses to employees dismissed late in the year, but Barclays opted not to follow suit.
Backlash and legal threats
The fired bankers are reportedly considering lawsuits seeking $10 million or more, arguing that bonuses are earned throughout the year and should not be treated as discretionary. However, Rahman cautioned that the odds of success are slim, noting, “Banks often stipulate in their labor agreements that you must be employed at the time of the bonus to receive it.”
Arbitration with the Financial Industry Regulatory Authority (FINRA) could be the next step for some.
Barclays defends its move
A Barclays spokesperson justified the layoffs, saying, “We regularly review our talent pool to ensure that we are investing in talent, delivering for clients, and best positioned for long-term success.”
The cuts come as part of Barclays’ three-year strategy to streamline operations and reduce its reliance on investment banking revenue. Despite these plans, the bank had been expected to boost bonuses in some departments by as much as 20% this year due to a rebound in dealmaking.
A pattern of tightened payouts
This isn’t the first time Barclays has tightened its purse strings. In 2023, the bank slashed bonuses by 43% amid declining revenue. Last year, dozens of bankers went without bonuses entirely.
With lawsuits looming and resentment brewing, Barclays’ holiday layoffs may be remembered as a cautionary tale for Wall Street firms balancing cost-cutting with employee morale.