Charles Schwab filed in November under New Jersey WARN laws for October layoffs in Jersey City -- the former TD Ameritrade RIA custody headquarters; the layoffs become official Feb. 5 under NJ labor laws

This article has been corrected to show that the Schwab staff indicated as set to leave in February by New Jersey WARN filings do not represent a fresh round of layoffs. Rather the “warning” – because of the rules framework's vicissitudes – occurs after the event itself. 

Charles Schwab Corp. filed a Worker Adjustment and Retraining Notification (WARN)  with the state of New Jersey targeting 109 layoffs for Feb. 5, according to a filing. (See Below) 

Under state law, workers are entitled to severance benefits. 

The cuts came in its East Coast hub that once served as headquarters for TD Ameritrade Institutional. The story was first published in the Bergen Record on Nov. 10.

It was then reported in more detail by ROI-NJ.com in December, but went largely unnoticed by industry publications. 

Schwab issued a statement to the latter Cedar Knolls, N.J., publication, confirming the plan to lay off up to 109 of its workers, the same number cited in the WARN notice. 

The $8.5 trillion firm did not specify who or what kinds of workers were pegged for layoffs.

But it explained they are simply the result of a streamlining plan put into effect back in July. See: Charles Schwab Corp. discloses imminent, sweeping 'TD Ameritrade' layoffs, indirectly revealed in new SEC filing 

 Budget cuts

“These steps included streamlining our operating model and staffing reductions, largely in non-client-facing areas. We have said goodbye to approximately 5% to 6% of our workforce across our firm. See: With the swiftness of a lightning strike, Charles Schwab Corp. fires as many as 2,000 employees

"These were hard but necessary steps to ensure Schwab remains highly competitive, with industry-leading levels of efficiency, well into the future," it wrote to NJ-ROI.

Schwab promised last July to cut $500 million in salaries and related expenses, including real estate, from its annual budget – a process it disclosed would drag well into 2024. 

Schwab also maintained its own presence in Jersey City before the TDA merger, according to Schwab insiders who asked not to be named. 

The two firms combined employed 500 to 600 individuals in Jersey City across three addresses, they add.

Job prospects

The anonymous sources cite 525 Washington Blvd. as likely to have the most cuts, followed by 125 Green Street. Schwab has an additional higher-end set of offices on the waterfront.

Laid-off workers should have good prospects for finding new jobs.

Active job postings in the Financial Services sector increased by 4.4% month-over-month, and by 0.86% since March, reaching 209,184 active job postings in June, according to the latest figures available. 

Joe Giannone, a long-time media spokesman for TD Ameritrade, departed Schwab in Jersey City this month, and immediately joined Pontera, a 401(k) Financial Advisor Software Management company also based in Jersey City.

Giannone did not respond to a query placed through LinkedIn. See: Pontera attracts yet another $45-million VC round for its 'held-away' 401(k) order management system and snags SageView, a $175-billion RIA, as a customer

Executive thinkers

Schwab's statement assured that it is handling the layoffs as humanely as possible.

“They are decisions that impact very talented people personally, and we take that very seriously. We worked diligently to ensure affected employees were treated with care and respect throughout this difficult process."

The cuts are not expected to affect RIA service, insiders say, but Schwab may take a hit on “intellectual capital” because many of the people let go are executive-level thinkers, the insider sources say.  

The financial service firm employs an estimated 35,900 staff.