FSA launches new guidance on 'buy out awards'

08 July 2011 at 16:43

FSA launches new guidance on 'buy out awards' The Financial Services Authority (FSA) has launched new guidance on 'buy-out' awards that are made to individuals joining firms.

According to the regulatory organisation, such payments are designed to act as remuneration for workers who have had to forego some form of monetary reward when leaving their previous position.

The FSA noted that while most companies were clear on the legislation surrounding offering applicants sign-on fees, some had voiced confusion over the rules on buy out awards.

As such the body has launched a new handbook to ensure firms have no excuse for not being FSA-compliant in the matter.

While the use of buy out awards is not encouraged, they can be given where the firm has taken reasonable steps to ensure that the fee is not more generous in amount or terms that the figure offered by the employee's previous company.

They buy out must also be subject to appropriate performance adjustment conditions such as malus or clawback.

In other news, the FSA recently launched a video on YouTube to educate the public about how to avoid landbanking.

Posted by Claire Robin ADNFCR-3006-ID-800616362-ADNFCR

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