BofA Puts Garden-Leave Restrictions On Financial Advisers
Bloomberg News reports that Bank of America made employees in its U.S. Trust wealth management division sign an agreement that prohibits them from soliciting their clients for eight months if they leave the company. And if they plan to resign, the employees would have to go on reduced-pay garden leave. Bloomberg obtained a copy of the document. Hugh Son reports that employees have to sign the document if they want to keep their jobs and received their 2010 bonus. The goal is to stem defections. BofA recently lost an financial adviser who had $5.9 billion in client assets, Bloomberg reports. "They're sending the message, 'Make no mistake, you will incur our wrath, this is not a place you want to leave,'" said Mindy Diamond, president of Diamond Consultants LLC, a Chester, New Jersey-based executive-search firm. "It's very rare that a company would have garden-leave provisions for producers, and I think this could backfire if people view it as draconian." A bank recruiter tells Bloomberg that the policy could also hurt the bank's recruiting efforts. Bank of America declined comment to Bloomberg. Read the rest of the report here.