Cost-cutting halves Singapore bankers' notice periods

Three months of paid notice is now the standard instead of the once luxurious six-month "gardening leave".

More employees working in non-client facing parts of banks are also being asked to work through their notice periods rather than being sent home, said international recruitment firm Astbury Marsden.

The reduced notice period perks for senior managers in Singapore investment banks and hedge funds were made to minimize unnecessary expenses.

“The days when a senior banker could spend over half a year relaxing on highly paid gardening leave are becoming a thing of the past," said Mark O’Reilly, Managing Director, Astbury Marsden Asia Pacific.

“Banks in Singapore are setting a new template for the relationship between themselves and their senior staff. Traditionally the rule was that banks would try to tie senior employees into long notice periods to stop them working for competitors. Notice periods are still longer for more senior managers but very few individuals have more than three months,” it added.

Traditionally notice periods have been up to six months for Managing Directors and three months for middle managers. As bank and investment houses have looked for ways to trim costs, typical notice periods have fallen to three months for Executive Directors and one month for Vice Presidents & AVP, said Astbury Marsden.

Mark O’Reilly explains: “Long notice periods for senior management have become an unnecessary expense for banks and investment houses which can currently pick from a high number of well-qualified candidates. Demand for senior level jobs in Singapore now outstrips supply as Asia continues to be an attractive proposition for bankers wishing to escape the continued uncertainty in Europe.”

“When the global economy was roaring, Singaporean financial institutions needed to offer big enticements to lure senior managers away from London and New York but this is no longer the case. Singapore now attracts talented candidates from those cities because ambitious senior banking staff want to be where the action is.”

Adds Mark O’Reilly: “Despite the changes to notice periods and scaled down benefit packages we do not expect to see a change in the flow of senior banking staff to Singapore. The city is now fully established as a global centre of excellence.”