Lawyers for Financial Professionals in New York
Helping You Take Legal Action Against Your Employer
As a banking professional or executive, you are in a position of great responsibility, and you uphold your duties with honesty and integrity. While you are working your hardest to protect the interests of the financial institution for which you work, you expect the company to adhere to its obligations concerning your employment with fairness. Unfortunately, that does not always happen, and you might find yourself in a civil dispute with your employer. Whether your case arises from unlawful retaliation, discrimination, or sexual harassment, you need a lawyer working for you to protect your rights.
Many employment disputes involving financial institutions can be resolved outside of court/arbitration. At Nisar Law Group, P.C., our New York employment law attorneys are skilled negotiators who will work toward a fair settlement for you. However, if your matter must be litigated, we are prepared to go to court/arbitration and argue your case there. Our employment law attorneys understand that the outcome of your case can have lasting impacts on your career and livelihood, which is why we will advocate effectively with your interest at heart.
Do you need to take legal action against your employer? Call us at (212) 600-9534 today to discuss your case.
Representing Financial and Banking Professionals in a Variety of Legal Matters
As with many other professions, when accepting a position as a financial professional or executive, you enter into various contracts and agreements establishing obligations by which you and your employer must abide. If your employer breaches your contract or violates employment laws, you have the right to take legal action against them.
Pursuing a lawsuit against your employer is not always easy. It requires a thorough understanding of the laws concerning your rights. Further, you will be going up against a company and its lawyers who will be doing everything to show that they are not liable for any wrongdoing. These pressures, on top of the stresses of your career being in jeopardy, can cause substantial frustrations. Our New York employment law attorneys will handle the nuances of your case, examine the details of your situation, review and analyze your documents, and evaluate all relevant facts, to work towards righting the wrongs you’ve suffered.
Both direct forms of discrimination, such as unfair promotion decisions, as well as indirect discrimination, like having policies that disadvantage employees of a particular religion, are unlawful. However, if a policy does exist that seems to treat a worker unfavorably, it may stay in place as long as the employer has objective justification for implementing it – meaning it’s necessary for safe business practices.
Title VII protections apply not only to traditional religions, such as Christianity or Buddhism, but also smaller sects or groups. A group is considered a religion if it is meaningful and concerns issues like life, death, or purpose. Personal beliefs, however, are generally not regarded as religious and not covered by federal law.
FINRA Form U4 - Arbitration of Employment Disputes
The Financial Industry Regulatory Authority, Inc. (FINRA) is a non-governmental private corporation that regulates brokerage firms and exchange markets and has the authority to discipline its member firms and individuals for violations of securities laws and rules. The government agency which oversees the entire securities industry, including FINRA, is the Securities and Exchange Commission (SEC).
When registering and hiring new employees/representatives, financial services firms must provide their employees with a Form U4, which is then electronically filed with FINRA. When employees sign their Form U4, they also receive an arbitration disclosure, specifically informing them that they are waiving their right to sue in court for any claims they have against their employer, which courts have found to be an enforceable arbitration agreement. However, certain employment claims are not arbitrable under FINRA rules, including class action lawsuits as well as collective action lawsuits.
Nondiscretionary Versus Discretionary Bonuses
Many financial services employees rely heavily on an anticipated annual bonus when deciding whether to accept a job. However, an employee’s right to receive a bonus payment depends on whether the bonus is discretionary or nondiscretionary. As a general rule, an employee has no legal right to compensation under a discretionary bonus plan. A bonus is deemed discretionary if both the fact and amount of the payment are determined in the sole discretion of the company. Nondiscretionary bonuses are based on either a fixed or guaranteed number or based on the performance of the employer, the employee, or a combination of the employer and the employee.
In New York, discretionary bonuses are not considered wages. Conversely, a nondiscretionary bonus is considered wages and failure to pay it may subject the employer to penalties under the New York Labor Law.
Form U5 Termination Notice/Expungement
When firms terminate the employment/registration of registered representatives, they must provide the employee with a Form U5, which provides a reason and explanation for the termination. The firm must also file the Form U5 with FINRA within 30 days of the employee’s termination.
Form U5 follows employees throughout their careers and can affect their future employment. As such, registered representatives may want to revise or expunge certain information contained on their Form U5. However, expungement is widely accepted as a remedy, not a private right of action. This means that a claim for expungement cannot be brought on its own and instead must be part of a larger discrimination claim, breach of contract claim, or other claim against the employer.
Non-Compete/Non-Solicitation Agreements
With respect to non-compete agreements or non-solicitation agreements, FINRA prohibits firms from interfering with a customer’s request to transfer an account if that customer decides to follow the employee to another firm where there is no existing dispute with the customer. However, a non-solicitation clause that prohibits the employee from soliciting customers may be enforceable because FINRA only addresses transfer requests initiated by the customer and not solicitation by the employee.
Whistleblower Anti-Retaliation Protections
The Sarbanes Oxley Act (SOX) was enacted to promote corporate accountability, protect investors, and protect whistleblowers. SOX specifically prohibits adverse employment actions against whistleblowers. SOX provides whistleblower protections for individuals who report about any action or inaction that the individual reasonably believes is a violation of a covered law to federal regulatory bodies or law enforcement agencies, members of Congress or congressional committees, and/or supervisors or persons authorized by the employer to investigate, discover, or terminate misconduct.
The Dodd-Frank Act (Dodd-Frank) amended SOX and created new protections and incentives for whistleblowers to report corporate wrongdoing. To be covered under Dodd-Frank, whistleblowers must report a specific violation of securities laws or commodities laws. Complaints about violations of general banking regulations are not covered. Unlike with SOX, which covers internal as well as external whistleblowing, an individual generally must report information to the SEC to meet the definition of a whistleblower under Dodd-Frank. Qualified whistleblowers who report both to the SEC and internally but suffer retaliation only because of their internal report are protected by Dodd-Frank.
Here for You from Start to Finish
At Nisar Law Group, P.C., our New York employment law attorneys are here to provide the legal representation you deserve. We will thoroughly examine your case to understand the truth of the matter and build a solid legal strategy on your behalf. Our lawyers will zealously advocate for you and will focus on your best interests as we seek a favorable resolution in your case. Backed by extensive legal experience, we have an in-depth understanding of the law and are familiar with the processes involved in resolving civil disputes within the financial industry.
Do you need to take legal action against your employer? Call us at (212) 600-9534 or submit an online contact form today to discuss your case.
Why We're the Right Choice
- Seasoned Litigators Who Have Handled Numerous Jury & Bench Trials
- Providing Representation with Clarity, Honesty & Integrity
- Building Long-Term Affiliations & Relationships
- Offering Consultations for All Case Types We Handle
Frequently Asked Questions About: Legal Representation for Banking Professionals
Banking professionals frequently encounter unique employment challenges including disputes over discretionary versus non-discretionary bonuses, FINRA arbitration requirements, Form U5 termination disclosures that can damage future career prospects, and enforcement of restrictive non-compete or non-solicitation agreements. These issues are complicated by the heavily regulated nature of the financial industry and specific rules governing securities professionals.
Other common issues include retaliation for whistleblowing under Sarbanes-Oxley or Dodd-Frank protections, discrimination or harassment claims that must often be resolved through FINRA arbitration rather than traditional courts, and contract disputes involving deferred compensation or equity awards that may have complex vesting and forfeiture provisions.
When you sign Form U4 as a condition of employment in the financial industry, you typically agree to resolve most employment disputes through FINRA arbitration rather than traditional court litigation. This means claims for discrimination, harassment, wrongful termination, and contract disputes must generally be arbitrated, which can have different procedural rules, discovery limitations, and potential remedies compared to court proceedings.
However, certain types of claims are not subject to FINRA arbitration, including class action lawsuits and collective action claims under the Fair Labor Standards Act. Additionally, some courts have found that certain statutory claims may still be pursued in court despite arbitration agreements, so it’s important to have an attorney evaluate your specific situation and the scope of your arbitration agreement.
Non-discretionary bonuses are based on specific, predetermined criteria such as individual performance metrics, company performance targets, or guaranteed amounts specified in your employment contract. These bonuses are considered wages under New York law, and employers face penalties for failing to pay them when earned. You have legal rights to pursue unpaid non-discretionary bonuses through litigation or arbitration.
Discretionary bonuses, on the other hand, are determined entirely at the employer’s discretion regarding both whether to pay them and the amount. These are not considered wages under New York law, meaning you generally have no legal right to receive them even if you performed well or met expectations. However, if an employer’s discretion is exercised in a discriminatory manner or violates other employment laws, you may still have legal recourse.
Form U5 termination notices follow you throughout your career in the financial industry and are reviewed by prospective employers, making negative disclosures potentially damaging to future employment opportunities. Common problematic disclosures include allegations of misconduct, performance issues, or compliance violations that may not accurately reflect the circumstances of your termination or may be based on false information.
While expungement of Form U5 information is possible, it’s not available as a standalone legal action. Instead, expungement requests must be part of a larger employment claim such as discrimination, wrongful termination, or breach of contract. If you can prove that the negative disclosure was retaliatory, discriminatory, or based on false information, you may be able to get it removed or modified as part of resolving your underlying employment dispute.
Non-compete agreements for banking professionals must be evaluated under both general employment law principles and specific FINRA rules. While employers can include non-compete clauses in employment contracts, FINRA prohibits firms from interfering with customers’ voluntary decisions to transfer their accounts to follow a representative to a new firm, which can limit the enforceability of certain restrictive covenants.
Non-solicitation agreements that prevent you from actively soliciting former clients may be more enforceable than broad non-compete clauses, since FINRA’s customer transfer rules only protect customer-initiated transfers, not employee solicitation. The enforceability of these agreements depends on factors like geographic scope, duration, the specificity of restrictions, and whether they’re necessary to protect legitimate business interests without overly restricting your ability to earn a living.
Banking professionals are protected under multiple whistleblower statutes, including the Sarbanes-Oxley Act (SOX) and the Dodd-Frank Act. SOX protects employees who report securities violations, mail fraud, bank fraud, or violations of SEC rules to federal agencies, Congress, or internal supervisors. SOX covers both internal and external reporting and prohibits retaliation for protected disclosures.
Dodd-Frank provides additional protections and potential financial rewards for reporting securities or commodities law violations to the SEC. Unlike SOX, Dodd-Frank generally requires reporting to the SEC to qualify for protection, though it does cover some internal reporting if you also report externally. Both laws provide remedies including reinstatement, back pay, and compensation for damages if you face retaliation for protected whistleblowing activities.
Challenging wrongful termination in the banking industry typically requires navigating FINRA arbitration procedures due to the Form U4 arbitration agreement you likely signed. You’ll need to gather evidence showing that your termination violated employment laws, such as discrimination, retaliation for whistleblowing, or breach of your employment contract terms.
Key evidence includes your employment file, performance reviews, communications showing the real reason for termination, and documentation of any protected activities you engaged in before termination. You must also address the Form U5 filing, as negative disclosures can compound the damage from wrongful termination. Working with an attorney experienced in financial industry employment law is crucial for navigating these complex procedures and protecting your career prospects.
If you’re experiencing retaliation for reporting compliance violations, document everything immediately, including the original violation you reported, to whom you reported it, and any subsequent adverse actions taken against you. Preserve all relevant communications, performance reviews, and other evidence that could show the retaliatory motive.
Consider whether your situation falls under SOX, Dodd-Frank, or other whistleblower protection laws, as each has different reporting requirements and deadlines. You may need to file a complaint with the Department of Labor (for SOX) or the SEC (for Dodd-Frank) before pursuing other remedies. Given the strict timelines and complex procedural requirements, consulting with an employment attorney experienced in financial industry whistleblower cases is essential to protect your rights.
Most employment disputes for banking professionals must be resolved through FINRA arbitration due to the Form U4 arbitration agreement, which courts generally enforce. This includes claims for discrimination, harassment, wrongful termination, and most contract disputes. However, there are some exceptions where you may be able to pursue court litigation.
Certain types of claims may not be subject to arbitration, including some whistleblower claims under federal statutes, class action lawsuits, and collective actions under wage and hour laws. Additionally, some courts have found that certain statutory claims cannot be waived through arbitration agreements. An experienced attorney can evaluate your specific situation to determine whether arbitration is required or if you have options for court litigation.
Compensation in banking industry employment disputes can include back pay and benefits, front pay if reinstatement isn’t feasible, compensation for lost bonuses (particularly non-discretionary bonuses), and damages for harm to your reputation and career prospects. In discrimination or retaliation cases, you may also recover emotional distress damages and, in some cases, punitive damages.
Given the high compensation levels common in banking, damages can be substantial, particularly when considering lost deferred compensation, unvested equity awards, and the long-term career impact of negative Form U5 disclosures. You may also be entitled to attorney’s fees in certain types of claims. The specific remedies available depend on the type of claim, the forum (arbitration vs. court), and the strength of your case.
