Insider sources have revealed that Wells Fargo & Co. has frozen its plans to provide top earners with raises due to the bank’s new leadership team’s focus on limiting costs. This decision will result in a halt to increases in the base pay for employees earning over $150,000 per annum for the coming year.
This is the second instance in a little over three weeks in which Wells Fargo leadership has sought to limit costs at the expense of pay raises based on performance. Other measures that the bank has implemented include no longer matching the contributions to its 401(k) retirement system for employees earning in excess of $250,000 per annum.
In the case of the 401(k) decision, Wells Fargo management decided to reverse its initial decision, citing the company’s need to focus on meeting the needs of lower-paid employees who rely more on benefits programs.
After taking over as Chief Executive Officer last October, Charlie Scharf initiated a cost-cutting spree that is aimed at reducing annual expenses by $10 billion.
