Morgan Stanley CEO James Gorman said on Monday he expects all New York City staff to return to the office full time by Labor Day, and if they don’t they may face salary cuts.
Gorman was speaking at the firm’s annual U.S. Financials, Payments & CRE Conference when he made the remarks, some of the strongest indicators yet of how big business will handle getting their staff back to work in person.
Right now, the bank still isn’t dictating how many days a week staff should come in, but Gorman says that’ll change if people don’t choose to come back themselves by the end of the summer.
He goes in four days a week right now, he said.
‘Make no mistake about it – we do our work inside Morgan Stanley offices, and that’s where we teach, that’s where our interns learn, that’s how we develop people .
‘On Labor Day, I’ll be very disappointed if people haven’t found their way into the office. Then, we’ll have a different kind of conversation.
‘If you can go into a restaurant in New York City, you can come into the office. We want you in the office,’ he said.
Morgan Stanley CEO James Gorman (shown in a 2019 photo) said on Monday he expects all New York City staff to return to the office full time by Labor Day
Gorman didn’t specify if staff will face termination if they don’t come back, or if anyone will be exempt.
HOW BIG BUSINESS IS GETTING PEOPLE BACK INTO THE OFFICE
Working from home: Voluntary return basis now, tough conversations if NYC staff aren’t back by Labor Day
Staff in Indian offices won’t be required back this year because of the ongoing health crisis.
Staff in UK won’t be required back yet because of strains of virus spreading (Indian and Delta)
Salary cuts: Cuts for anyone who has relocated from NYC to a cheaper city but wants to continue working remotely from there
Working from home: Most NYC staff back in office, as a matter of policy, on Monday June 14.
There was free food in the office and coffee stands throughout to encourage casual, ‘water cooler’ conversations about work
Most London staff are expected back by June 21 – the ‘freedom day’ originally set by Boris Johnson
Salary cuts: No word yet on if people who have voluntarily relocated will face cuts but the bank is planning to move 100 roles from NYC to West Palm Beach.
It’s unclear if that’s part of a strategy to lower cost by enforcing lower salaries, or if the salaries will remain the same but business taxes will be lower
JP MORGAN CHASE
WFH: Wants staff back but will cap Manhattan office at 50% capacity.
In the long term, a maximum of 10 percent of the company’s 225,000 staff will work from home permanently.
WFH: Staff can still choose to work from home. CEO Jane Fraser says she wants to wait to force staff back until young kids can get vaccinated and childcare – like summer camps – resume fully to free parents up to return full time
WFH: Mark Zuckerberg said last week that he won’t go back to the office for another 6 months but that staff will have to start going in, in some way, starting from September.
It’s unclear yet how it’ll take shape but staff will be expected in at least 50% of the work week and they’ll need manager’s approval to stay at home
Salary cuts: Anyone who moves out of NYC or San Francisco for a cheaper city but wants to keep collecting their wage won’t be allowed to
Morgan Stanley also hasn’t forced any staff to come back in yet at all, whereas Goldman Sachs brought back most staff on Monday morning.
He said that 90 percent of the staff who are coming into work are vaccinated and that by Labor Day, he expects the number to be 98 percent.
If people don’t want to get vaccinated for health or religious reasons, he says the firm will enter HR discussions with them.
He also warned anyone who has relocated to a cheaper city during the pandemic and wants to keep working remotely from there that they can expect their salaries to be cut.
It’s a strategy other businesses, like Facebook, have also adopted.
‘If you want to get paid New York rates, you work in New York. None of this, “I’m in Colorado and work in New York and am getting paid like I’m sitting in New York City”. Sorry, that doesn’t work.’
Gorman returned to work four days a week in July. He had COVID-19 last year and recovered. He later partnered with a healthcare firm to give workers’ vaccines in the office.
Gorman said that staff in India, where 10,000 are employed, won’t be expected back in the office this year because the health crisis there is ongoing and the vaccine roll-out is slow.
The same goes for the UK, which is further ahead with vaccines but has seen a spike in cases with the Delta and Indian variants of COVID.
In NYC, 70 percent of people are vaccinated and cases continue to drop; across the state of New York on Saturday, just 0.5 percent of people tested were positive and there were only 158 cases in NYC – just 0.001 percent of the population.
Mayor Bill de Blasio says all public schools will return to a full-time, in person learning schedule in September.
Private schools can decide for themselves which approach to take.
It comes as other white collar sectors report struggles in getting people back to work.
In New York City and San Francisco – two enormous business hubs where the office workforce keeps almost every other part of the local businesses going – only 21 percent have come back to the office.
Cities in Texas, however, have managed to get more people back in; in Austin, Dallas and Houston the return rate is nearly 50 percent, according to Kastle Systems, an office-security company.
They monitored the key-card swipes in their 2,500 buildings across the country to get the data. It was reported by The Wall Street Journal on Tuesday.
It may be down to the fact that people in Texan cities use their own cars to get to work more than they rely on public transport, but it could also come down to local restrictions and advice.
Since the start of the pandemic, people in Republican cities and states have been less frightened of going back to work or even staying in the office throughout the pandemic. California and New York have been among the strictest in imposing lockdowns and rules.
Now, major businesses are trying to find ways to get people back into the office full-time.
Some HR departments are cautious about telling parents to come back before their kids’ childcare or in-school learning resumes.
‘Women are absolutely nervous about it. I’m seeing the HR and business leaders at banks recognizing, understanding and starting to plan around fairness in evaluations,’ Rob Dicks, Accenture Plc’s talent and organization lead for capital markets, told Bloomberg on Monday.