Report: Jefferies Faced Employee Revolt Over Pay

By FOXBusiness

A number of executives at Jefferies (NYSE:JEF) reportedly threatened to jump ship in recent days amid outrage over the midsize investment bank’s compensation and restructuring plans.

According to The Wall Street Journal, several executives and other workers at New York-based Jefferies threatened to depart the company over the restructuring and year-end compensation issues.

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After a series of meetings on Tuesday, Glen Dailey, global head of the prime brokerage, told the Journal no one was leaving, adding, “family affairs are now in order.” About a half-dozen prim-brokerage employees had been in talks about leaving and in some cases eyed joining rivals, the paper reported.

It would have been particularly bad timing for a mass exodus at Jefferies, which spent the last several months fending off fears about its exposure to European sovereign debt in the wake of the collapse of MF Global.

The report highlights the resistance financial-services firms are facing as they attempt to slash costs by reducing headcount and lowering bonuses due to slumping revenue and increased regulation.

Jefferies recently changed its rules to require employees who receive a cash bonus to return it to the company if they join a rival within a year, the Journal reported.

Shares of Jefferies, which plunged almost 50% over the past year, declined 2.57% to $13.64 Wednesday morning.