Selch had been a Chicago-based employee at Wanger Asset Management for more than decade when it merged with Columbia Asset Management, a subsidiary of Bank of America, in 2005.
As so often happens in these Wall Street mergers, some of the employees of Wanger weren't happy with the way the new bosses planned to pay them. Bank of America, in particular, has a bad reputation for trying to squeeze the compensation packages of bankers and advisers at firms it acquires. (Read more: New Worries Over Broker Pay at Bank of America)
According to court documents, Selch's friend Chris O'Dea was fired after he refused to accept lower compensation. This ticked Selch off. (Hat tip: Court House News.)
Selch burst into a conference room where executives from Columbia were meeting to give them a piece of his mind. He wound up giving them a piece of something else as well.
First Selch asked if he had a non-compete agreement, which on Wall Street is usually a way of threatening to quit and go to work for a competitor.
After the executives said he didn't have a non-compete, Selch mooned them, told one of the New York-based executives never to return to Chicago, and left the meeting.
Extraordinarily, Selch wasn't fired. Instead he was issued a formal warning. Selch’s boss testified that while 99 percent of employees would have been immediately fired, Selch was one of the one percent who could be granted a one-free-mooning reprieve. The executive actually fought for Selch to keep his job.
When Columbia CEO Brian Banks found out about this incident, he insisted that Selch be fired. The behavior was too “egregious” to allow Selch to continue at Columbia. No free mooning at Bank of America, Banks decided—even if you are in the one percent.
The firing meant that Selch lost a multi-million contingent bonus package that would have vested if he had remained at the company a few months more. Because he was fired, Bank of America got the keep the money.
Selch sued, arguing that firing him after issuing warning was a breach of contract. The warning had said he could be fired if he misbehaved in the future—yet after that one mooning, by all accounts Selch was well-behaved. What’s more, Selch argued that because the mooning didn’t interfere with his official duties, he couldn’t be fired “for cause.”
The trial court granted summary judgment to the defendants in the suit. Last Wednesday, a 3-judge appeals panel upheld the trial court, describing the mooning as “insubordinate, disruptive, unruly and abusive.”
So, just in case it was unclear, you can’t moon your boss and expect to keep your job. Or your bonus.
- by CNBC.com senior editor John Carney
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