Goldman Sachs' partners were quietly deprived of one of their perks
If you're a partner at Goldman Sachs, you're not short of money. Partner managing directors at the firm receive salaries alone of $950k, plus bonuses, plus the opportunity to invest alongside Goldman Sachs itself in the firm's private equity funds, hedge funds and other investment vehicles. In 2022, Goldman Sachs' CEO David Solomon made $15.5m from these investments.
In the circumstances, it might be presumed that retired Goldman Sachs partners are more than capable of looking after themselves. And yet, for a long, long time, the firm looked after its partners even after they left: historically, when Goldman partners with more than eight years' service retired, the firm paid 75% of their healthcare costs indefinitely, along with the costs accrued by their dependents.
But as Goldman has cut costs, those benefits have been trimmed. As of this year, Goldman won't be subsidizing any new partners' healthcare in retirement; nor will it be subsidizing the healthcare of their dependents. And it won't be doing so irrespective of how many years they spend working for the firm.
The change of policy is buried in the proxy statement Goldman released for its annual meeting of shareholders in April, but has gone unnoticed until now. All future partner managing directors will be made to pay "100% of the retiree medical premium" themselves.
This is unlikely to be a problem for individual partners, but it does indicate a change in approach: Goldman is no longer the paternalistic former employer it used to be. It also suggests that the firm might be motivated to expel existing partners before they reach eight years' tenure and it's then obliged to pay their medical insurance indefinitely.
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