(September 8 – 15:30 ET) – A group of former Salomon Smith Barney brokers have certified a class action suit against their old firm, according to The Street.com.
The former SSB brokers are fighting for deferred compensation they gave up when they left the firm. SSB brokers were permitted to receive some of their pretax compensation in discounted shares. The stock vests over a rolling two-year period, so SSB retains the unvested stock when a broker leaves. The former brokers contend that the plan is unfair, although it has been very successful in helping the firm retain employees.
Now the Superior Court of New Jersey in Essex County has certified the case as a class action. An SSB spokesman is quoted saying the firm “respectfully disagrees with the ruling and will appeal at the appropriate time.”
However the brokers’ lawyer, Bruce Nagel, says this is the first suit of its type to be certified as a class action in the U.S., calling it, “A significant victory for the brokers.” Nagel estimates the suit could be US$50 million in claims against SSB. It is expected to come to trial within a year.
-IE Staff