If you’re a junior banker at Deutsche Bank you will not get a bonus for your work this year. Nor (most probably) will you get a bonus if you’re a junior who works for DWS Group – the former asset management arm of Deutsche Bank. In the first case, this will not come as a surprise. In the latter, it could come as a shock.
Deutsche Bank has not paid bonuses to junior staff below assistant vice president (AVP) level since around 2017, when previous CEO John Cryan reformed compensation for junior staff. Since then, Deutsche’s juniors have only been eligible for ‘recognition awards,’ or smaller cash payments for good performance. In theory, the bank has hiked salaries to compensate for this – although in reality Deutsche Bank’s junior salaries appear to be on a par with everyone else’s.
DWS used to be like Deutsche Bank. The asset management firm employs around 4,000 people and was part of DB until March this year, when it spun out (although DB remains the main shareholder). Juniors at the asset management firm are complaining that at the time of the IPO they were informed that the newly independent company would “be ending” Cryan’s pay edict and paying its juniors bonuses again. “This boosted morale among junior staff,” says one, who says there was no further communication for months. – Until now.
In the past week, the junior says it’s become apparent that bonuses won’t be reinstated for everyone after all. “It now appears that variable compensation is returning to some juniors but not all. Those in “product” areas will now be eligible but those outside of “product” will not. This has only been communicated to those who are now eligible, not those who are not.” He claims that juniors at DWS in Germany will also be excluded from this year’s bonus round.
A spokesman for DWS said the company is in the middle of a, “complex process,” to, “work towards a compensation structure more closely aligned with market practice and the regulatory frameworks of the asset management industry.” Ultimately, the spokesman says the intention is to, “reward all our employees based on overall performance – including cultural objectives.” – But this won’t be achieved in time for 2018 bonuses.
Despite the ongoing denial of performance pay, DWS juniors have had some love this year. – The company gave everyone a generous one-off award at the time of the IPO. “All employees, regardless of corporate title, were granted IPO-related awards on top of their regular total compensation packages,” says the spokesman.
Sarah Butcher – Read the full article on efinancialcareers.com