Citi and HSBC order more US staff to work in offices five days a week

Citigroup and HSBC Holdings are ordering more U.S. employees to report to company offices five days a week as regulatory changes make it more complicated for Wall Street to allow work from home.

Citigroup is requiring about 600 employees who were previously eligible to work remotely to come to the company’s offices full time, the New York-based firm said in a statement on May 23. Even then, most staff can continue their hybrid schedules, working up to two days a week outside the office, it said.

At HSBC, the change in regulations affects about 530 employees in New York – about half of its workforce in the city – and the bank is talking to them about their options, said Mabel Rius, head of human resources for the United States and the Americas, in an interview.

The company is trying to allow as many people as possible to retain the option to log in from home if they wish, Rius said. HSBC’s regional boss has said he may avoid a blanket five-day mandate for all staff.

The two banks are known to be among the most flexible on Wall Street in allowing employees to continue working remotely after the pandemic. The changes come as the Financial Industry Regulatory Authority – the main watchdog of the US brokerage industry – is set to adjust rules for monitoring workplaces in the coming weeks.

This may spell the end of remote work for many bank traders and some other dealmakers, as bosses conclude that allowing the practice under Finra’s changing rules is not worth the cost. Companies such as Barclays and Deutsche Bank have been assessing the burden as they consider changes to their own policies.

While some bosses blame Finra’s rules for a new series of five-day mandates, regulators have responded, saying that, if anything, they are trying to allow more flexibility, not less.

The tension arises from US requirements that banks monitor staff and facilitate regular workplace inspections. When Covid-19 broke out, regulators initially relaxed some of their rules to ensure people could work from home. Some of those accommodations are now on the verge of disappearing.

While Finra says the changes do not require companies to call staff into offices five days a week, it has acknowledged that compliance takes work.

Some central offices will have to be listed with regulators as so-called “residential monitoring locations.” A pilot program for those sites establishes a system to inspect them remotely at least every three years, starting in July. Privately, some executives have said that keeping up with requirements can come at a steep price to preserve an employee’s ability to log in from the comfort of their home.

Ultimately, companies may come to different conclusions. Barclays is among banks that have also been considering a five-day mandate for some employees, people with knowledge of the matter said earlier this week. At Deutsche Bank, executives hope the company can remain compliant with a limited impact on its protocols, according to a person with knowledge of their thinking. In April, Truist Financial Corporation told investment banking staff that they must work from the office every business day starting June 1.

Some of Wall Street’s biggest banks – such as Bank of America Corporation, JPMorgan Chase & Co. and Goldman Sachs Group – have already adopted five-day commutes to the office on many of their desks, at least in practice, if not like rules. But some smaller franchises have touted flexibility, which can give them an advantage when recruiting and retaining talent. BLOOMBERG

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