Senate Banking Committee Chair Sherrod Brown, D-OH, is asking the Federal Reserve and Office of the Comptroller of the Currency to investigate allegations of labor abuse by Wells Fargo, in opposition to efforts by the bank’s employees to unionize.
“Regulators should take stronger actions to change Wells Fargo’s culture of noncompliance and account for the troubling unfair labor practice allegations that could be the bellwether for broader safety and soundness and consumer compliance risks,” Brown wrote Wednesday in a letter to acting OCC chief Michael Hsu and Michael Barr, the Fed’s vice chair for supervision.
Brown cited a spate of charges Wells Fargo employees have filed with the National Labor Relations Board over the past year. Employees in Arizona and Iowa alleged last month that supervisors at the bank retaliated against employees who were organizing union efforts, Brown said. The bank and the NLRB reached an informal settlement in May after a manager allegedly threatened an employee who was distributing pro-union literature to co-workers at a Salt Lake City call center, Bloomberg Law reported. The NLRB also investigated three cases involving similar allegations at Wells Fargo’s Beaverton, Oregon, call center, Brown said.
Wells Fargo, for its part, “respect[s] employees’ rights under the National Labor Relations Act and our policies do not prohibit employees from discussing wages, benefits and terms of employment, or otherwise engaging in collective activity,” a spokesperson for the bank told Banking Dive in April (and May).
The bank, however, “believes our employees are best served by working directly with the company and its leadership — not a third-party group like a union — to address matters of concern,” the spokesperson said.
Brown on Wednesday said regulators must factor allegations of unfair labor practices into their assessments of Wells Fargo’s safety and soundness.
“Not only are violations of federal labor laws illegal, but they are also indicative of poor corporate governance and risk management [and] can be indicators of greater risk to the institution and consumers,” Brown wrote Wednesday.
This is hardly the first time Brown has taken issue with cultural woes at Wells Fargo. The senator, in May 2022, called out the bank over reports of racial disparities in mortgage lending, fake job interviews for nonwhite and female candidates and anti-money laundering concerns in a letter to Wells Fargo CEO Charlie Scharf.
“These recent problems add to the laundry list of consumer abuses and compliance breakdowns that led to the imposition of a growth restriction on [Wells Fargo] in 2018,” Brown wrote last year, referring to a $1.95 trillion asset cap the Fed placed on the bank. “I urge you to once and for all address Wells Fargo’s governance, risk management, and hiring practices — weaknesses that have plagued the bank for almost a decade.”
Brown’s most recent letter may telegraph a line of questioning Brown intends to engage with Scharf at a just-announced Dec. 6 hearing, where eight bank CEOs are set to testify in front of the Senate banking panel. Brown noted, in Wednesday’s letter, that Scharf testified last year that he would not remain neutral if Wells Fargo employees try to unionize.
Image vs. perception
At least one Wells Fargo Workers United member has called “laughable” the notion that the bank respects workers’ rights to collective bargaining.
“I think that maybe that’s the image they have of themselves. They like to think that they’re socially progressive and that they are willing to be open and welcoming, which on a lot of levels could be true,” Trevor Brown, a 10-year Wells Fargo employee based in Arizona, told Banking Dive in April. “But the moment you bring up anything like competitive pay or some term of employment, that inclusiveness is not there anymore.”
“The reality is, once you actually begin those conversations, there’s a lot of vitriol — from people taking flyers, tearing them in half, and throwing them in the garbage, to people saying you’re not allowed to talk about anything union-related in a workplace setting,” Trevor Brown added. “[Voiced complaints and concerns] are often met with disdain or you being cast as a troublemaker, or just being told that they’ll work on it next year.”
In his letter Wednesday, the senator asserted that potential labor law violations “raise additional concerns about Wells Fargo’s continued inability to fix its long-standing problems and do right by its customers, investors and workers.”
“Existing monetary penalties and growth restrictions have not been sufficient to prevent Wells Fargo from repeated consumer abuses, compliance failures and gross mismanagement,” the senator said Wednesday.
