When an oral (assurance) is not enough
JPMorgan is being taken to court by a former employee who claims the bank failed to honour a verbal promise.
"You always need to get things in writing," says Charles Ferguson, of Ferguson Solicitors. "Otherwise, you'll need to prove beyond the balance of probability that there really was an agreement - you'll need to make a case that's 51% certain. Meanwhile, the bank just needs to deny that such an agreement took place."
JPMorgan's disagreement concerns an employee's ability to retain stock and options after leaving the bank. Bloomberg reports that former head of options trading Daniel Ridgway is seeking damages of around 260k from the bank, both for his 2003 bonus and options and stock awarded in 2001 and 2002.
Ridgeway says he was told he could keep the payouts if he left the bank on good terms. JPMorgan reportedly denies it ever said such a thing.
Another lawyer (who works on behalf of banks and asked not to be named), says banks aren't as duplicitous as they're made out to be. And rather than failing to honour verbal assurances concerning pay for staff already in work, she says most misunderstandings occur during the solicitation period prior to employment.
"It usually happens in interview. The line manager might say, 'You'll definitely get a 500k bonus here,' but there'll be no mention of that in your contract."
Line managers are rather prone to saying such things, she adds. As a result, most HR managers add special clauses to contracts specifying that what's written down is an 'entire agreement' and supersedes all that went before. You have been warned!
