A year on from the death of Moritz Erhardt, what can banking interns expect this summer?
Investment banking summer internships are always harsh, but this year's banking interns may be inclined to temper that harshness with pragmatism. Is it really worth working stupidly long hours when your health may suffer as a result?
The excessive hours worked by some banking interns were highlighted by the tragic death last summer of Moritz Erhardt, Erhardt had been interning in IBD at Bank of America when he died in the shower at Claredale House, a residential facility in Hackney which houses around 200 interns from banks across the City of London. An inquest found that Erhardt died of an epileptic seizure, of which the coroner said fatigue could have been a possible trigger. Erhardt, who had sent emails at 5am prior to his death, was said to have worked three consecutive all-nighters at BAML, plus five other all-nighters in a two week period. His death led to revelations of the 'magic roundabout' - a practice in which reportedly get a taxi back to their accommodation at 5am, shower and change their clothes while the taxi waits outside, and then go straight back to the office.
In the immediate aftermath of Erhardt's death, rival banks were said to have emailed staffers requesting that they go easy on the students who were with them for the summer. In the months that followed, most introduced policies to reduce the pressure on the junior bankers who worked full time. But summer 2014 marks the first set of internships after Erhardt's death. So, what's changed?
We asked Bank of America, Barclays, Citi, Credit Suisse, Goldman Sachs, JPMorgan, Morgan Stanley and RBS to talk to us about the alterations they've introduced to their summer analyst (AKA intern) programmes. Not all were willing to comment. Bank of America, which was at the centre of last year's storm, said it had nothing to add to the changes that were reported to its full time analyst programme in January 2014. Similarly, most banks said summer analysts will protected by the measures introduced to prevent full time analysts from overworking. No banks were willing to talk frankly about the issue of interns overworking, but many gave us information on background. Based upon this information, this is what this year's banking interns should expect:
1. Summer interns may be compelled to take a holiday in the middle of the internship
The length of summer internships at investment banks varies. At Bank of America, Erhardt's internship was reportedly an intense seven weeks. At Deutsche, investment banking internships last around nine weeks. At Goldman Sachs, internships last for ten weeks and at JPMorgan and Citi internships can go on for up to 12 weeks.
During long internships like JPMorgan's, it's standard for interns to be offered a short period of holiday leave. In the past interns typically didn't take this leave, preferring to dazzle their prospective employer with their commitment. This year, we understand that JPMorgan and others will be compelling interns to take their allocated time out - although days off are likely to be dotted around the internship rather than taken consecutively in one block. At Deutsche Bank, intern holidays (in regions where they're offered) will be both encouraged and tracked.
2. Interns will be made to take time off at the weekends
Christian Meissner, head of investment banking at Bank of America, said this week that analysts at the firm are benefiting from BofA's insistence that they take at least four weekend days off each month. This policy applies equally to interns. Other banks have introduced similar protections for weekends: Goldman Sachs insists that juniors are out of the office between 9pm on Fridays and 9am on Sundays, Credit Suisse insists they're out between 6pm on Friday and 10am on Sundays, Citi insists they're out between 10pm on Friday and 10am on Sunday, JPMorgan demands that juniors have one full weekend off per month, and Deutsche now stipulates that its junior bankers have at least five weekend days off monthly.
Most banks are policing these 'weekend off' policies rigorously. Interns who work weekends in contravention of the policies will typically need sign-off from a very senior manager (eg. group head level at Citi).
3. Interns will be intensely monitored to ensure they're not being given too much work by inept managers
The problem of over-worked interns in investment banks is partly down to the high-performance culture of the interns themselves (they want to work hard and to be seen in the office at 2am), and partly down to poor management.
"There is really nothing in this business that requires pushing people to work these kind of long hours," says one junior banker on the forum discussing Erhardt's death. "Most of the 4am, 5am, 6am nights that I have had were caused by ridiculous requests by seniors that could wait till tomorrow," he adds.
Accordingly, banks like Deutsche and Goldman Sachs have tried to restructure junior bankers' workload to avoid unnecessary requests from senior staff and prevent long working hours. At Deutsche Bank, a 'feedback loop' has been added to track interns' progress. At JPMorgan, interns have a mentors to help guide them during the internship and communicate working norms. JPMorgan's interns will also need to fill out a weekly review sheet stating how long they've worked and what they've been doing so that managers can review their workload and assign projects more effectively.
Interns who do find themselves working stupidly long hours this summer may want to step back and question whether it's all worth it: yes, you might get a £45k job offer when you graduate, but banking is a marathon and not a sprint, Those who succeed and earn the most money long term are those who can pace themselves and don't burn themselves out at the start.