Tom Reese/Paul Rubillo, Dividend.com
Lehman Brothers (LEHMQ) employees are coming to grips with some harsh realities. Barclays (BCS) is making plans for the purchase of Lehman’s investment banking and capital markets, which may involve close to 10,000 employees.
Questions abound regarding how an integration of the deal will pan out, as employees may have mixed feelings on what the future holds for them and their retirement savings. Some employees may want to stick with the company, while others will look for work elsewhere, or perhaps even leave Wall Street behind altogether.
Lehman employees must understand that there may be little recourse to regain their life savings under traditional bankruptcy laws. Litigation is certainly an option, but there are no guarantees in that world, with similar cases typically taking years to resolve. There has been talk of stock compensation as part of the Barclays transaction, but no details of such a plan have been released.
The Bottom Line
Investors and employees with retirement plans to be cognizant of what is happening within their companies. If your employer is publicly traded, be sure to closely monitor the stock price. Lehman is not the first company to file bankruptcy, and will certainly not be the last. Lastly, never put all your eggs in one basket, especially when it comes to your retirement savings. The worst case scenario does sometimes happen, as we have been witnessing in the current tumultuous economic environment.
Be sure to visit our complete recommended list of the Best Dividend Stocks as well as a detailed explanation of our ratings system here.
