Wall Street Layoffs: What you Need to Know - Lyneka Little

Lyneka Little writes for MAINSTREET powered by THESTREET.COM.

'Tis the season for layoffs, but not all layoffs are created equal, and on Wall Street sometimes the way you are let go can be a violation of regulation rules.

Consider this hypothetical: “A trader or investment banker at a securities firm who has increased revenue and worked hard the entire year but is laid off prior to the date on which bonuses are paid has a strong claim,” says Michael Deutsch, co-founder of Singer Deutsch LLP, a Securities law firm. “A proprietary trader, for example, may have generated a substantial return on his or her book, yet the firm reaps all the profits without fairly compensating the employee.”

Sound shady to you? Some are interpreting massive financial service layoffs in the same way. As a result, individuals are seeking counsel to learn their rights.

In October, the Financial Industry Regulatory Authority, the agency that oversees securities firms, saw an increase of all arbitration filings by nearly 50% compared to the same period last year.

“We have seen a tremendous influx of calls because firms have used this as an opportunity to avoid paying bonuses and there is no question in our minds that there are going to be increased claims,” says Deutsch.

Are you wondering about proper compensation due to a layoff in the securities industry? Here's what you need to know:

1. If you are a representative or a broker in the securities industry and you think you believe you have been laid off illegally, you may seek resolution using FINRA, says Brendan Intindola, spokesperson for FINRA.
2. If you’re a customer and you have a broker, and you believe think your broker has done something wrong, you can address the issue by filing an arbitration claim at FINRA, says Intindola.

To file a claim for Breach of Conduct or numerous other reasons, FINRA offers an arbitration online filing system. (The typical claim may take 6 to 13 months for resolution.)

Retaining a lawyer is not necessary, but you might consider an attorney to “ascertain what your rights are to know if it would be productive to file a claim and to learn what your causes of action are,” says Deutsch.