The process when a broker or advisor changes firms can often times be messy and uncomfortable, and problems can arise with the firm you are leaving as well as the firm you are moving to. When moving away from a firm, problems usually surface around client retention, existing promissory notes or loans, outstanding compensation, and the language included on your Form U-5, to name a few. When moving to a new firm, issues involving employment contract negotiations, trade secrets and methodologies, and compensation can occur.
When you leave a brokerage or advisory firm, the firm will assuredly seek repayment of any unpaid balances you have with the firm. These unpaid balances can include any loans the firm made to you during your employment and outstanding arbitration awards involving employment related issues. Consulting a skilled securities industry employment attorney, like those at Malecki Law, can help decide whether fighting back, paying the balances, or negotiating a settlement and/or payment plan with your firm is in your best interests.
While a sizeable bonus may be enticing when joining a new firm, you should be aware of certain caveats that are associated with upfront bonuses. Generally, an upfront bonus will compensate a broker or advisor for their work performance in the preceding year before joining the new firm. These bonuses, however, are usually structured as promissory notes, meaning there are certain conditions you must fulfill to prevent your firm from calling the note early, namely staying employed with the firm for a certain period of time and/or meeting sales goals. You should consider the characteristics of your new firm and your specific employment factors before accepting a new job because of an upfront bonus.
Considering the various issues that can arise when transitioning to a new firm, we highly recommend that you consult an attorney practicing securities employment law, like the ones at Malecki Law. Malecki Law can help you negotiate severance packages, establish payment plans for outstanding loans, and aid in any other issues that arise from your transition to a new firm.
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