2019 Comp: UBS Leaves Plan Mostly Untouched, Retains Strings on Bonuses
UBS Wealth Management USA on Wednesday told brokers it will keep its payout grid and other core parts of its compensation plan unchanged in 2019.
But in a video explaining the plan that will be sent in detail in the next few days, Brian Hull, head of the brokerage force of almost 6,900 advisors, reminded them that if they accept performance bonuses they will be subject to a one-year non-solicitation agreement of customers if they leave.
A memo on the comp plan together with the video were distributed as part of a lunchtime communication, said several brokers and other people at UBS.
The firm is the second big U.S. brokerage firm to try to control expectations about the annual pay program that directs brokers into areas that firms want them to emphasize with clients. Morgan Stanley in late July told its almost 16,000 brokers that payout grids and bonuses from 2018 will largely remain intact but offered extra pay based on the number of clients they get into financial plans and on the level of clients who contribute more assets to their accounts.
UBS, which like Morgan Stanley has pulled out of the Protocol for Broker Recruiting and has been hiring few experienced brokers from other firms, is also emphasizing financial planning and teamwork with its plan. One of the few changes from 2018 will be more flexibility in the way that team leaders can distribute compensation among other brokers and assistants. Firms encourage teams that can specialize in different areas of a client balance sheet beyond brokers’ traditional emphasis on investing.
The UBS plan next year also gives brokers who generate $1 million or more of net new business more flexibility in calculating how they can qualify for the maximum $250,000 bonus attached to the award.
In his video presentation, Hull reminded brokers that if they do not want to be subject to the customer non-solicit clause, they should not sign the agreement they will receive in February to accept the “strategic objective” bonuses. Hull and UBS AG Wealth co-head Tom Naratil earlier this year issued a mea culpa to brokers for having allowed the non-solicit bonus strings to be included in their agreements to accept the 2018 awards, but told them to expect the restrictions going forward. “InvestmentNews” reported the memo on the compensation plan earlier today.