Jefferies’ COVID case outbreak casts a veil on Wall St office’s return

December 8 (Reuters) – Investment bank Jefferies Financial Group (JEF.N) on Wednesday asked staff to work from home again amid a spate of COVID-19 cases, raising questions about the efforts of banks to resume their activities as usual.

U.S. banks have been more assertive than other industries in encouraging employees to return to the office, but these plans have come under intense scrutiny due to the rapid spread of the Omicron variant.

Jefferies said he’s also canceling guest parties and virtually all travel. The company’s disclosure sparked speculation whether other banks would follow suit.

“Those financial institutions and Wall Street companies that thought there would be an automatic return to work and were pushing for it will be re-examining their current return-to-work status, especially given employee concerns,” Brian said. Marks, a former banking regulator and now a senior lecturer at New Haven University School of Business.

Jefferies, headquartered in midtown Manhattan, recalled its staff to its offices in October. The bank has strongly felt the impact of the pandemic, its CFO Peg Broadbent having died of complications related to the coronavirus in March 2020.

“Our priority now is to best protect each of you and your families,” wrote managing director Richard Handler in a note seen by Reuters. “Effective today, we are canceling all social and entertainment events until January 3.”

Jefferies added in the note that while it was “beyond the urge of all of our staff to return to our offices … When you can, we ask that you work from home.”

The cabinet recorded more than 40 new cases of COVID-19 this month, including 10 on Tuesday, the note said, adding that very few cases have required hospitalization. Handler added that Jefferies was reimposing a mask warrant in all offices, regardless of vaccination status.

Jefferies, who had seen an average attendance of up to 60% several days worldwide in recent weeks, said he would need booster doses by Jan.31.

The investment bank, which has 4,500 employees worldwide, also has offices in Asia and Europe. More than 95% of Jefferies staff are now vaccinated and all visitors to the Jefferies offices must be fully vaccinated, Handler said in the note.

Jefferies did not say where staff worked with COVID.

The bank’s shares closed down 2.3%.

New York has established a vaccine requirement for workers at all private companies as the highly transmissible variant of Omicron spreads to more states in the United States. The New York mayor’s office and the New York City Department of Financial Services did not respond to requests for comment on the Jefferies cases.

Most of the major US banks have had staff working in their offices since the summer. Senior bankers such as Goldman Sachs CEO David Solomon and Morgan Stanley CEO James Gorman spoke about the benefits of in-person interaction, especially for younger employees.

So far, U.S. banks are sticking to their existing COVID-19 policies, although sources from the “Big Six” companies say they are monitoring developments closely. Read more

Goldman Sachs (GS.N), Morgan Stanley (MS.N) and JPMorgan (JPM.N) have brought most workers back to their offices on a rotational basis since the summer.

Others, like Wells Fargo (WFC.N), Citigroup (CN) and Bank of America (BAC.N), have taken a more flexible stance.

Wells Fargo pushed back plans to return to the office to January, while Citigroup employees in New York, Chicago, Boston, Philadelphia and Washington, DC have been working from the office at least two days a week since September 13.

HOLIDAY PARTIES

Some US banks also choose not to have holiday celebrations. Wells Fargo said Wednesday it had no plans for any company-wide celebrations. Team parties are at the discretion of the individual managers. Citi will not be hosting holiday parties this year to help prevent the spread of COVID-19, a source familiar with the matter said.

In Europe, where Omicron has spread more quickly, some banks have canceled events such as JPMorgan’s annual Christmas carol reception in London and the New Year’s Eve party in Paris.

Deutsche Bank (DBKGn.DE) has told its London staff it can organize small team-level gatherings. Asset manager Schroders (SDR.L) and the City of London Corporation, which runs London’s historic financial district, are asking guests to take quick tests before certain festive events. Read more

Some large US companies are also pushing back their return date from their offices due to the Omicron variant. Read more

Businesses “need to do a balancing act,” Marks said. “While it’s really important to bring people together, (concerns about COVID-19) could sever the relationship to the point of no return, causing employees to seek other jobs. “

(This story corrects the number of Jefferies employees worldwide in the 10th paragraph to 4,500, not 3,000)

Reporting by Matt Scuffham and Aaron Saldanha, additional reporting by Sruthi Shankar in Bangalore and Elizabeth Dilts Marshall; written by Matt Scuffham and Megan Davies; edited by Edward Tobin and Cynthia Osterman

Our Standards: Thomson Reuters Trust Principles.