By Frederick P. Gabriel Jr.
Putnam Investments LLC is taking steps to avert a possible brain drain.
The Boston-based mutual fund giant handed out 2003 bonuses to their key employees on Feb. 13, instead of mid-March, when it usually makes the highly anticipated payout. The early distribution of 2003 bonuses is intended to appease employees who have long griped about Putnam's policy of paying bonuses later than other fund companies.
Putnam has also abolished its policy of paying the bonuses over a three-year vesting period, marking the elimination of yet another practice long despised by many company employees.
In an effort to keep key employees from bolting, Putnam's parent, New York insurer Marsh & McLennan Cos. Inc., also promised Putnam executives that the 2004 bonus pool will remain the same as it was in 2003 — despite any drop in assets.
The moves, many of which are being pushed by Charles "Ed" Haldeman, Putnam's new chief executive, are intended to mollify executives, most of whom have had their world rocked in recent months by scandal and regime change.
The actions are also meant to send a clear message to Putnam's some 5,500 employees that life is now "radically different" at the firm, he said. Under the leadership of former chief executive Lawrence Lasser, who was ousted in November, Putnam earned a reputation for being an extremely difficult place to work.
To drive that point home even further, Mr. Haldeman has also done away with Putnam's long-standing policy of demanding that new executives sign employment contracts. While many fund companies have such a policy, the contract that Putnam employees were made to sign was notorious for its stringency.
"I don't believe much in contracts," he said. "What you ought to do is make the place a good place to work so people want to be here."
While Mr. Haldeman hopes the policy changes will make Putnam a more enjoyable place to work, he also hopes they will help him weed out employees who are unhappy and simply biding time until they can collect their bonuses.