‘Generalist’ compliance staff flood market following remediation completion

The completion of remediation projects by firms such as AMP have led to an influx of compliance professionals entering the market.

Numerous large financial services firms, including AMP, Macquarie Group and ANZ, have been paying remediation to customers over the past few years following the Royal Commission into Misconduct in the Banking, Superannuation, and Financial Services Industry. This related to fees for no service misconduct or non-compliant advice.

As of March 2023, AMP had offered or paid $636 million to more than 340,000 customers for fees for no service misconduct and paid $42 million to almost 3,000 customers for non-compliant advice. 

As well as internal compliance staff, Kaizen Recruitment flagged staff at Deloitte, which runs a remediation advisory team focused on advice quality and fees for no service remediation within financial advice, had also entered the market. Services offered by this team include designing remediation methodologies, stakeholder engagement strategies, and acting as independent experts.

In an update, the recruitment firm said: “Remediation projects wrapped last year, including projects at AMP and Deloitte, which pushed wealth compliance and risk candidates into the market in tandem.

VIEW ALL

View all

“Two of the big four banks and Macquarie Group held large-scale redundancies in Q3–4 last year, mainly in Sydney. This left candidates from the banking industry competing for roles in other financial services verticals or moving externally to industries, such as energy, which benefited in acquiring risk and compliance candidates who had operated in more heavily-regulated environments.”

With many of these staff having previously been employed as contractors, as firms seek to keep up with the necessary remediation payment backlog, they receive higher-than-average salaries than a full-time employee.

However, these candidates found their pay back then was typically lower than this.

“These candidates initially landed with inflated salary expectations having just collected contract rates for the better part of two years. It took some time for these candidates to adjust to what the market would reasonably pay for their skill set. 

“Candidates often had to take a step back in remuneration to re-enter the market, and many had to step back in seniority.”

As well as their pay expectations, employers also noted these types of candidates only had a narrow breadth of compliance experience as they had typically been focused on one type of compliance in their previous role.

Previously, a nationwide salary survey by recruitment firm Hays found compliance managers could earn around $95,000–$130,000 per annum, while heads of compliance could earn $130,000–$260,000 per annum.

Kaizen recommended that compliance staff with this “narrow” skill set opted for new roles that were more niche and tried to expand their generalist skill set.

Burnout effect

Kaizen also noted the trend of compliance professionals facing burnout risk, as covered by Money Management last month, as executives and senior leadership opted to depart without another job to go to. 

At lower levels, staff were leaving middle management roles as they felt they had a lack of development, or questioned if they wanted to work in the sector long term.

This then had the knock-on effect of teams being even more stretched, especially around holiday periods or if an employee was on leave, which contributed to even more staff looking to depart.

“The lack of senior leadership in businesses noted seemed to result in a trend not seen previously with executives and senior leaders resigning before the holiday break over Christmas without another role to go to. 

“Many cited increased workloads due to heavy changes in regulation, years of change, project and transformation work, a delayed burnout felt due to COVID-19, and a severe lack of talent and headcount to meet workload demands on teams as the reasons they resigned.

“Frustration around delayed hiring practices and running very lean teams, as a result, seemed to create this domino effect where a candidate would resign, the workload would fall onto the remaining staff leading to further burnout and having to allocate time to sit in interviews to choose a replacement – only to have that manager then resign to take another (hopefully less stressful) position.”