More good news for anyone who doesn’t get promoted to managing director this year: just because you’re an MD, it doesn’t mean you’ll be paid more than the directors or VPs who report to you.
Ron Greenidge, Kweku Adoboli’s former boss, illustrates the sad reality.
After 20 years at UBS, Bloomberg says Greenidge, former head of European equities trading at UBS, was earning £286k a year, including bonus. By comparison, Kweku Adoboli – who’d spent a mere 6 years at UBS, was paid a total of £360k during his final year at the bank (2010).
Greenidge looks underpaid
Kweku’s package was a reflection of the esteem in which he appeared to have been held at UBS. Adoboli was seen as a rising star at the bank, said detective chief inspector Perry Stokes, from the City of London police after the trader was charged with fraud: “He believed he was going to reach the heights within UBS and his colleagues thought the same. His supervisors, seniors, managers, they all saw him as one for the future.”
By comparison, Greenidge – after spending two decades working his way up at the bank – may have been seen as a safe pair of supervisory hands.
Zaheer Ibrahim at search firm Kennedy Group says it’s not unusual for heads of desks and businesses to be paid less than the star traders who work for them. “If one trader’s been successful and the rest haven’t, the head of desk has to carry that – the star trader has to be paid.”
Many senior trader managers hardly ever move jobs, says Ibrahim. It’s harder for them to move to a hedge fund than it is for a trader, and they tend to become entrenched in a particular investment banking franchise as a result.
Unlike some of Adoboli’s colleagues, Greenidge isn’t currently in employment. He was said to nearly faint when he took to the witness stand in Adoboli’s trial and hasn’t been registered with the FSA since October 2011. He was fired from UBS for gross misconduct.
Bloomberg reports that Greenidge is now taking the bank to court, alleging race discrimination and unfair dismissal. Greenidge says that because he was black like Kweku, UBS may have wrongly assumed that he had a shared bond with Adoboli. He also claims that he was treated less favourably than his white counterparts.
Elaine Aarons, an employment partner at law firm Withers, says that if he’s to succeed in his claim of race discrimination Greenidge will need establish a prima facie case that his treatment was inconsistent with that of his colleagues and that this inconsistency was because of his race. It will then be for the bank to prove otherwise. . “However, the bottom line is that the fact he is black and he has been treated inconsistently with others is not enough to prove discrimination. There needs to be more evidence that race discrimination was involved than just that,” Aarons says.
Successful discrimination claims offer the promise of unlimited compensation. The vast majority of discrimination claims are settled out of court, says Aarons. If UBS obliges, this could yet prove a way for Greenidge to top up his compensation a few years after the event.