Reports: Merrill Lynch to cut 1,900 staff

Reports claim Merrill Lynch and its new owner Bank of America are preparing to slash 1,900 staff in London.

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Reports claim Merrill Lynch and its new owner Bank of America are preparing to slash 1,900 staff in London, including back office workers.

Management at the banks are looking to cut 30 percent of the combined workforce in London, reported The Times newspaper.

Merrill Lynch declined to comment on the article and said it was unable to confirm the amount of job cuts for the UK, nor provide a break down as to how many IT staff affected.

The Bank of America (BofA) completed its acquisition of Merrill Lynch on 1 January 2009, to form one of the largest brokerages in the world, with more than 20,000 advisors and $2.5 trillion in client assets.

BofA announced on 11 December that it would cut up to 35,000 positions over the next three years worldwide, after purchasing Merrill Lynch.

The bank said the cuts will come from both companies and affect all business lines, and in part reflect "the weak economic environment, which is affecting the level of business activity".

The merged bank is aiming to achieve $7 billion (£4.8 billion) in savings by 2012. The banks have said cost reductions will come through job cuts, and the "reduction of overlapping technology, vendor and marketing expenses".

Merrill Lynch employs 6,000 people in the UK, while BoA has about 1,700 in London.

In other employment-related news, Merrill Lynch and Bank of America are also facing a lawsuit from back office employees for alleged labour violations, according to law firm Fitapelli & Schaffer.

The lawsuit alleges that Merrill Lynch and BofA failed to pay overtime to back office employees who facilitate transactions of the company's derivatives products.

Andrea Levine and Ivey Moore, who are both derivatives settlement specialists for Merrill, filed suit on Monday in New York federal court.

The suit claims that the plaintiffs and other Merrill Lynch Derivatives Settlement Specialists have been "blatantly misclassified as 'exempt'" and "regularly worked in excess of 40 hours per week and were not paid time and one half for any and all hours over 40 in a given week".

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