Wells Fargo to Freeze Raises for High Earners as It Limits Costs

By Hannah Levitt

News November 05, 2020 at 09:28 AM

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A Wells Fargo branch in New York. (Photo: Bloomberg)

Wells Fargo & Co. plans to freeze raises for top earners as the bank's new leadership team retools compensation practices with a close eye on costs, according to people briefed on the plans.

The measure, revealed to some managers on a conference call Wednesday, will halt increases in base pay in the coming year for employees making more than $150,000, the people said.

It's at least the second time in just a few weeks that the firm has sought to limit the expense of rewarding well-paid employees.

A spokesperson for the San Francisco-based lender declined to comment.

See: Wells Fargo Makes Sizable Cuts to Advisor Force

Chief Executive Officer Charlie Scharf, who took over last October, has embarked on a cost-cutting spree aimed at shaving $10 billion in annual expenses. Already, the company has started workforce reductions that could ultimately number in the tens of thousands.

The bank aborted an attempt last month to stop matching contributions to its 401(k) retirement system for employees who earn more than $250,000 a year. In that case, the firm announced the change, then reversed course just a few days later.

The company said the move was part of a push to put "greater emphasis on how we support our lower-paid employees through our compensation and benefits program."