NEW YORK ( TheStreet) -- It is bonus week on Wall Street and for once, it is the top dogs who have to contend with the prospect of a shrinking pay check. Investment banks routinely cut compensation expenses when faced with a lackluster revenue environment, but CEOs and other senior ranking officials usually take home big bonuses, while the underlings are fired. But attempts in the past two years to rein in compensation expenses have largely failed, as revenues have dropped more than anticipated. While banks continue to reduce headcount, they are increasingly targeting their "efficiency" programs towards senior employees, whose pay tends to be an order- of- magnitude higher than a fresh-faced junior trader. Morgan Stanley ( MS), which reports Friday, is in the middle of laying off 1,600 employees in the investment banking and infrastructure support divisions, according to people familiar with the company's plans. The cuts will be focused on senior employees. On Tuesday, several press reports said the investment bank is also deferring 100% of the bonuses awarded to employees earning more than $350,000 a year and where the bonus is greater than $50,000. The effort appears to be a response to shareholders who have been pressing for deeper cuts to compensation to driver profit. Recently, activist investor Dan Loeb took a stake in Morgan Stanley and is pushing for change in the compensation practices at the investment bank. Loeb believes the bank's board is overcompensated relative to banks of similar size. But it is not just Morgan Stanley's senior employees that are taking a hit. At rival Goldman Sachs ( GS), which routinely culls its worst performing staff, a number of partners have been encouraged to retire and fewer employees were made partner last year. And at JPMorgan Chase ( JPM), even CEO Jamie Dimon and former CFO Doug Braunstein might see a smaller bonus, as they pay for the trading debacle that cost the firm billions in losses last year. The board of the New York bank is meeting Tuesday to review how much the executives should be paid. --Written by Shanthi Bharatwaj in New York >To contact the writer of this article, click here: Shanthi Bharatwaj. >To follow the writer on Twitter, go to http://twitter.com/shavenk. >To submit a news tip, send an email to: firstname.lastname@example.org.