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Industry Spotlight > Wirehouse Firms

UBS Embraces WFH as Morgan Stanley Doubles Down on Office Return

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What You Need to Know

  • UBS has announced a new virtual worker framework that will allow at least some roles at the firm to be 100% remote.
  • Most advisor/broker reps, however, will likely continue to work on a hybrid basis.
  • The wirehouse's strategy is more flexible than that of rival Morgan Stanley, which could hurt the latter firm's recruiting ability.

The remote work-friendly strategy that UBS announced on Wednesday for “eligible” U.S. employees stands to give it a recruiting advantage over rival Morgan Stanley, according to recruiter Mark Elzweig, president of Mark Elzweig Co.

“I think it’s fair to say that it puts Morgan Stanley at a disadvantage when compared to UBS because Morgan Stanley is locking advisors into a particular number of work-from-home days” now, Elzweig told ThinkAdvisor.

The new virtual worker framework announced by UBS, which will allow at least some roles to be 100% remote, is a “natural extension and evolution of UBS’s current hybrid work model,” the wirehouse said in a news release.

This new approach to flexible working was “designed to appeal to [a] diverse talent pool and increase retention, while enhancing client service,” the company said.

UBS will start a “phased implementation of the framework over the coming months to select current and prospective employees across the country,” it said. The implementation will begin with “eligible Global Wealth Management roles in the U.S., and will be aligned with all regulatory guidelines,” according to the company. UBS declined to specify when the phase-in will start.

The company didn’t specify in its announcement exactly how this will affect the firm’s advisor/broker reps. But it is not expected to significantly change the hybrid format that many of them had already been using even before the pandemic, with some days spent working at the office, some on the road and some days working from home or elsewhere remotely.

Some senior UBS reps may end up working more days remotely than others, while some of the newest UBS reps may end up working from a branch office more than others, at least initially.

Morgan Stanley’s Strategy

In stark contrast, starting July 1, Morgan Stanley Wealth Management will start limiting most of its sales force to 90 days of remote work each year, AdvisorHub reported March 16.

Advisor/broker reps who want more remote time than that will need to apply for an alternate work location, the report said, citing “sources.”

“Eligibility for a remote office will be based on criteria including length of service or membership in production-based recognition clubs and manager approval,” the report said.

Reps working from alternative remote locations will also be subject to further supervisory requirements, including periodic remote inspections, the report added.

“We developed our long-term approach in consultation with advisors and are offering different options to enable them to maintain flexibility that balances their needs as well as those of our clients and our business,” a Morgan Stanley spokesperson told ThinkAdvisor on Tuesday. “Flexibility options will differ by employee based upon role and eligibility.”

The company is “not prohibiting remote work flexibility [to] 90 days a year,” a person familiar with Morgan Stanley’s strategy told ThinkAdvisor. “Vacation and business travel are not considered remote work,” that source said.

Most Morgan Stanley advisors have “already returned to the office,” that source said, adding that the wirehouse’s “general guideline for flexwork is less than 90 [days and] after that they can apply for consideration for other arrangements,” one of which is called an alternative work arrangement, the source added.

The firm’s current policy is in line with the position expressed by Morgan Stanley CEO James Gorman in June, when he told the online Morgan Stanley U.S. Financials, Payments & CRE Conference he expected that most of the firm’s U.S. employees would return to their offices by the fall.

However, “my view is a more nuanced communication is necessary,” he said. Not every country is through the height of the pandemic yet, he noted — for example, India-based workers would not be coming back to offices in 2021.

There is also a difference between talking to employees at the firm’s Times Square office in New York and those at a small office in Topeka, Kansas, he said.

“I don’t think making a blanket statement to all employees is helpful,” he told viewers. But he added: “Make no mistake about it. We do our work inside Morgan Stanley offices, and that’s where we teach, that’s where our interns learn, that’s how we develop people.”

The company had been using a hybrid approach since the pandemic started, gradually increasing the number of days in which many employees work in their offices at the firm.

The firm will offer “some flexibility” for employees who face certain hardships, Gorman said. However, “that doesn’t mean, ‘Hey, it’s Monday, Wednesday, Friday, and, you know, I’m in Florida,’” he said. “If you want to get paid New York rates, you work in New York. None of this, ‘I’m in Colorado and work in New York and getting paid like I’m sitting in New York City.’ Sorry, that doesn’t work.”

Although he does not want to be “dictatorial” about exactly when employees return to the office full time, he said: “I’ll be very disappointed if people haven’t found their way into the office” by the Labor Day holiday, “and then we’ll have a different kind of conversation.”

After all, “if you can go into a restaurant in New York City,“ he said, “you can come into the office, and we want you in the office.”

Giving the People What They Want

UBS pointed to a global survey that found 86% of UBS employees stated they valued more flexibility, including the ability to maintain a remote or hybrid work arrangement. As technology enhancements and positive adoption of virtual work continue, UBS said it’s “finding new ways to engage with clients and build trusted relationships.”

“Hybrid working has positively reshaped the future of our workplace,” according to Tom Naratil, president of UBS Americas.

“We’re reimagining the way we work and believe this framework will provide an enhanced work-life balance for some of our employees, appeal to a more diverse pool of applicants and increase employee retention,” he said in a statement. “We recognize the world has changed and we continue to adapt so that we can deliver the best for our clients and our people.”

UBS employees who participate in the virtual worker framework “will benefit from virtual engagement opportunities, full access to the firm’s technology platform and applications, and periodic in-person events that will help them build strong relationships with their teams and clients,” it said.

Noting that the company has long supported flexible working, Marc Montanaro, head of human resources at UBS Americas, said in the news release: “We recognize that many employees feel they are more productive and satisfied when they have greater control over their schedule.”

UBS employees “have different needs and demands on their time based on their location, family and personal life, career stage and other factors — some of which change over time,” he added. “This framework will allow employees to more seamlessly balance their responsibilities at UBS with other parts of their life.”

In the future, working with their management teams and partners in HR, employees that participate in the virtual worker framework “will have the opportunity to modify their remote work arrangements in the event they would like to return to the office or work in a hybrid arrangement,” according to UBS.

Wells Fargo’s Strategy

Wells Fargo’s strategy, meanwhile, seems to fall somewhere in the middle of Morgan Stanley and UBS on the flexibility scale among the wirehouses.

“As planned, beginning March 14, 2022, most U.S. employee groups began to return to a hybrid flexible model,” a Wells Fargo spokesperson told ThinkAdvisor on Tuesday. “We are thrilled to begin welcoming the rest of our employees back to the office so we can once again be together, reunite with familiar faces, and build new relationships.”

“We strongly believe in the benefits of seeing our colleagues on a regular basis,” she said, noting, it “will help each of us foster stronger relationships, support in-the-moment collaboration, and allow us to better serve our customers and communities.”

She added: “Our go-forward approach will be office-based, with flexibility. In practice, this means the flexibility to have up to two days a week of remote work, and spending a minimum of three days a week in the office.”

Merrill Lynch/Bank of America did not immediately respond to a request for comment.

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