Bear Analysts Irked By Severance Memo

All other employees in the research department were designated administrative, making them eligible for the higher payments. While the research department does produce revenue, most of it was internal. The clearing department pays millions to fund the department, as does the institutional and private-equity departments. The research was also sold externally, but the amounts were not significant enough to make much difference. While analysts do meet with clients, they do not earn commissions for doing so.

Bear spokeswoman Monica Orbe declined to comment on Booth's memo. She referred questions about potential severance to JPMorgan. A JPMorgan spokeswoman declined to comment.

Shareholders are expected to officially vote on the merger deal on May 29, but the meeting is seen as a technicality since JPMorgan has already secured enough votes for it to pass. Many Bear employees have already met at least once with JPMorgan and some have additional meetings coming up, the Bear employees say.

"I've been assured I have a job through the summer, but after that who knows," says one employee, who declined to be identified. "I have another interview [Monday] with [JPMorgan], but I have no idea which way it will go."

Some of the Bear employees expected to be laid off have been asked to remain for 90 days to assist with the transition, the sources said. The formula to determine how much of administrative workers' 2007 bonus will be paid as severance is based on how many weeks they work in 2008. So if they stay 90 days after the deal closes, it could be three-quarters of the year.