Morgan Stanley CEO suggests workers could face pay cut if they fail to return to office by Labor Day

‘If you can go into a restaurant in New York City, you can come into the office’

The chief executive of Morgan Stanley has said the company will be expecting its employees to return to the office by Labor day, suggesting that those who have moved out of state could expect a pay cut.

James Gorman said at an annual conference on Monday that while the company wouldn’t be making a “blanket statement” for employees across the globe, those in New York should be preparing to return in person.

“A more nuanced communication is necessary,” Mr Gorman said, before adding: “But, make no mistake about it – we do our work inside Morgan Stanley offices.”

He continued: “That’s where we teach, that’s where our interns learn, that’s where you build all the soft cues that go with building a successful career that aren’t just about Zoom presentations.”

The investment banking chief said: “If you can go into a restaurant in New York City, you can come into the office. We want you in the office.”

Mr Gorman went on to say that the firm wouldn’t be allowing its workers to move the majority of their working week out of state, suggesting their pay package could suffer.

He said the company wouldn’t be “dictatorial” in its approach and would allow for circumstances such as parents not being able to find adequate childcare.

However, he said that “doesn’t mean, ‘hey it’ll be Monday, Wednesday and Friday and I’m in Florida’."

“If you want to get paid New York rates, you work in New York,” the CEO said, adding: “None of this I’m in Colorado getting paid like I’m sitting in New York City. Sorry that doesn’t work.”

Mr Gorman explained that as CEO he had returned to the office for one day a week by Labor Day last year and incrementally increased those days over time.

Since March this year he has been working four days in the office, he said.

The CEO said that “if people haven’t found their way into the office” by Labor Day in September, the company would be having a “different kind of conversation”.

Mr Gorman caught Covid in March last year and “completely recovered” from the disease, saying that his condition had been “manageable”.