Last week, Goldman Sachs shocked Wall Street by announcing that it was making dramatic changes to its junior analyst program, including encouraging its overworked junior investment bankers to take weekends off. But nobody was more surprised by the changes than Goldman's young bankers themselves. Now, with rules that reserve their Saturdays for "critical client activity," the firm's underlings are afraid they're being marked for punishment if they work too hard.
According to one Goldman analyst, the firm's junior bankers have been told that unless they receive a special waiver, they aren't supposed to set foot inside Goldman's offices for a period of 36 hours every weekend. (The period lasts from 9 p.m. Friday until 9 a.m. Sunday). Moreover, the analyst said, junior bankers have been told that the firm's IT department may check remote logins to make sure they're not working from home during the off-limits time period, and that supervisors who are found to have assigned them excessive weekend work without a waiver will be disciplined.
People close to the firm say that monitoring the work habits of junior analysts isn't meant to create a Big Brother environment, but merely to see if the program is working. "Our goal is to give junior bankers greater predictability and flexibility with their time," Goldman spokesman David Wells told Daily Intelligencer. "As we implement the program, we'll be communicating and working with our people to find a good balance and see what works."
The new weekend rules – which were created by a firmwide "junior banker task force" and tested in the bank's healthcare and technology banking groups before being rolled out to the firm at large last week – were designed to free Goldman's junior analysts from the 100-hour weeks and marathon Excel sessions that have been standard on Wall Street for decades. They were also supposed to help Goldman compete for new recruits with tech firms like Google and Facebook, which pay high salaries but also offer lavish workplace perks and a more relaxed schedule to young employees.
Instead, a week in, the rules seem to have created more questions than relaxation. Several current and former banking analysts said they weren't sure if the new weekends-off rules were meant to be taken seriously, or if they were just a publicity stunt that would be ignored in practice. They also have questions about how the rules will be enforced. Will those who obey the rules and take Saturdays off be punished when it comes time to pick bonuses and promotions? Will senior bankers just stuff a weekend's worth of work into Sundays?
"People are still figuring out what it all means," one analyst said.
Part of the issue for Goldman is that it's not just junior analysts whose behavior is being modified by the new rules. It's also the associates, vice presidents, and managing directors who assign work to younger bankers, all of whom need to change their habits as well. Some of the people who came to work at Goldman came expressly because they wanted to work themselves to the bone, and changing such a deeply ingrained culture of overexertion is a structural challenge.
Some analysts, at Goldman and elsewhere, wondered if the new Goldman rules were a response to the death of Moritz Erhardt, a 21-year-old Bank of America Merrill Lynch intern who died of an epileptic seizure reportedly after pulling three straight all-nighters. (In truth, Goldman's junior banker task force was formed well before Erhardt's death.)
More likely is that Goldman is just trying to keep its existing bankers from jumping ship, and make itself more appealing to recruits, even if it means some short-term confusion. In fact, if Goldman can get the kinks in its new junior banker appeasement plan worked out, the firm may want to consider extending the new rules to its post-MBA associates as well; today's Wall Street Journal reports that older business school grads, like their fresh-from-college counterparts, are also increasingly picking tech over finance.