FINRA Baseball Caps, Rice Krispies Treats, Hiring Spree, And ZOOM OTRs (BrokeAndBroker.com Blog / May 1, 2020)
http://www.brokeandbroker.com/5197/FINRA-Zoom-OTR/Personal note from Bill Singer -- Not the time for FINRA to ZOOM through witnesses' rights (Securities Industry Commentator / April 7, 2020)http://www.rrbdlaw.com/5153/securities-industry-commentator/#zoom
ARBITRATORS' EXPLANATION OF DECISIONClaimant asserts seven causes of action as follows: breach of contract for bonus (first cause); breach of implied covenant of good faith and fair dealing (second cause); violation of New York Labor Law for bonus and deferred compensation (third cause); severance (fourth cause); quantum meruit (fifth cause), unjust enrichment/restitution (sixth cause); and promissory estoppel (seventh cause).The Panel has taken careful note of the proof and the law, and concludes that Claimant fails to state a claim with respect to the first, second, third, fifth, sixth, and seventh causes of action. Therefore, these claims are denied. Claimant's claim for severance asserted in the fourth cause of action is granted.The Panel finds in specific that the parties entered into a written agreement dated September 29, 2008 for at-will employment. It expressly states the terms of Claimant's employment with regard to compensation and guaranteed cash bonus for the year 2008. Following the opening paragraphs, the agreement continues on the subject of future bonuses. It expressly states: "It is understood that you must be an employee of good standing at the time the payments are due in order to receive them. Future bonus payments will be discretionary unless expressly stated otherwise in accordance with Barclays practice." The employment agreement also contains an integration clause. The proof established that the employment agreement was at no time amended or modified and is thereby enforceable against Claimant.Claimant does not contest that Respondent was within its right to terminate him, but claims he is entitled to a 2018 incentive bonus award based on his performance. Since there is an express contract that specifically addresses the issue of future bonus, Claimant contended that he had a separate breach of contract claim based on an implied contract which he contended is evidenced by a course of conduct for such bonuses over a ten year period. Further, Claimant claims the amount of the incentive award should be based on a formula of bonus to production representing his annual experience.As a general rule, "[a]n implied contract arises in the absence of an express agreement." Berardi v. Fundamental Brokers, Inc. Fundamental Brokers, Inc., 1990 U.S. Dist. LEXIS 11388 (S.D.N.Y. Aug. 30, 1990), at pg. 8, a case cited by Claimant. The I Court continues in footnote 9 that "an implied contract cannot co-exist with an express agreement." The cases Claimant relied upon address the issue of arbitrary withholding of bonuses where the claim is based on oral agreements. This is not such a case. The existence of an express agreement inconsistent with the theories advanced is fatal to Claimant's contract, quasi-contract, and equitable claims, and they are denied.With respect to the third cause of action for alleged violation of New York Labor Law, Claimant was employed as a high risk derivatives trader whose compensation was structured in accordance with U.K. law to include what is termed a "role based pay". Respondent offered testimonial proof that Respondent was a U.K. banking entity subject to certain compensation laws imposed on U.K. banks based on a trader's role. Claimant received a base salary, plus an "additional fixed payment", as well as the "role based pay". The role based pay was disproportionately higher than the base amounts by a factor of six. The Panel finds that Respondent did not act unlawfully in deciding not to pay a bonus. The decision was consistent with the terms of the employment agreement, namely that "[f]uture bonus payments will be discretionary unless expressly stated otherwise in accordance with Barclays practice" and that to be entitled to a bonus the employee must be "in good standing at the time the payments are due in order to receive them." The Panel finds that the incentive bonus was discretionary and not a right, and for this reason did not constitute "wages" as that term is defined in New York Labor Law.As to the fourth cause of action, the Panel finds that Claimant is entitled to severance, notwithstanding Claimant's contention expressed in this arbitration that he was unlawfully deprived of a bonus based on performance for the year of termination. Severance of an employee of long standing terminated on a restructuring of the business and not for cause is standard practice. Accordingly, Claimant's claim for severance is granted in the amount of $200,000.00 less required withholding payroll taxes and other applicable deductions, without prejudgment interest.At the conclusion of their closing arguments, both parties requested attorney's fees, but Claimant's request was limited to his claim of violation under Labor Law §198. Under the American Rule, attorneys' fees may be shifted if agreed upon by contract or by statute. There is no contract for prevailing party attorneys' fees in this case. Respondent's argument that it is entitled to attorneys' fees if requested by both parties is unavailing since Claimant specifically limited its request to a statutory right and not generally on the other causes. Accordingly, Respondent's request for attorneys' fees as prevailing party on the first, second, third, fifth, sixth, and seventh cause of action is denied. Claimant has no contract basis for attorneys' fees on the fourth cause of action and his request is also denied.