The way Wells Fargo treated its employees is the real scandal
It has surely been a couple of difficult months for Wells Fargo & Co. and its chief executive officer, John Stumpf. The bank had to pony up $185 million in September to settle state and federal investigations after the discovery of as many as two million fraudulent accounts opened for customers without their permission. Worse, Mr. Stumpf had to endure a humiliating congressional grilling by Senator Elizabeth Warren, Democrat of Massachusetts, before resigning in disgrace on Oct. 12.
In mid-October the company’s top brass joined around 500 senior executives in an hourlong crisis-management call. One issue that did not come up? The well-being of Wells Fargo employees. It was the bank’s intense pressure to “cross sell” accounts that convinced many low-level employees that it was preferable to break the law than to miss quotas.
Wells Fargo may not be alone in this regard. A June 2016 report on the retail banking sector by the National Employment Law Project found that “workers suffer harassment and threats in order to make ever-changing over-aggressive quotas.” The report suggests how easy it can be to move from abusing corporate employees to abusing customers and clients.
The real scandal at Wells Fargo may be not just the fraudulent accounts but also the years of wage-hour violations and gut-wrenching pressure on low-paid employees. In the absence of union representation and with unreliable enforcement by the understaffed Department of Labor, who is protecting the workers who could then be in a better position to protect customers?
Wells Fargo reports that over the last five years it has terminated 5,300 employees for “inappropriate sales conduct.” Not one of the bank’s top managers received a pink slip.