Brown calls for regulators to look into alleged Wells Fargo labor violations

Bloomberg News

WASHINGTON — Senate Banking Committee Chair Sherrod Brown, D-Ohio, called on the Federal Reserve and the Office of the Comptroller of the Currency to look into Wells Fargo's unionization efforts and alleged labor abuses.  

In Wednesday's letter, addressed to the Fed's Vice Chair for Supervision Michael Barr and acting Comptroller Michael Hsu, Brown cited an informal settlement with the National Labor Review Board over a manager allegedly threatening a senior advisor who was disturbing pro-union literature at a call center, three Unfair Labor Practice cases investigated at an Oregon call center and several other Unfair Labor Practice investigations and cases.

At the Oregon call center, staffers alleged that flyers posted by members of Wells Fargo Workers United, which was established in late 2021 by employees seeking to unionize, were repeatedly torn down by managers. Workers were also allegedly prohibited from wearing shirts bearing messaging and other imagery associated with the Committee for Better Banks, which helped establish the Workers United group.

Brown said that the filings are notable because, in the case of Wells Fargo's fake account scandal, management engaged in "threats and retaliation against thousands of Wells Fargo workers that helped keep the misconduct unabated for years." 

"It is important that bank regulators consider allegations of unfair labor practices, including threats and retaliation by Wells Fargo against frontline employees, in their assessment of the bank's safety and soundness," Brown said. "Not only are violations of federal labor laws illegal, but they are also indicative of poor corporate governance and risk management. Abusive labor conditions and retaliation against workers who attempt to communicate concerns raise red flags about management quality and can be indicators of greater risk to the institution and consumers."

Politics and policy

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Wells Fargo — which has faced unprecedented regulatory scrutiny in recent years — is alone among the country's largest banks in being subject to a unionization push among its workers. Part of that effort is in response to a culture that workers and regulators say led to employees feeling pressured to sell to the extent that they opened millions of unauthorized bank and credit card accounts for customers.

"Recent allegations of unfair labor practices against Wells Fargo are yet another example of the bank's pattern of repeatedly violating a range of federal and state laws," Brown said. "Existing monetary penalties and growth restrictions have not been sufficient to prevent Wells Fargo from repeated consumer abuses, compliance failures, and gross mismanagement. 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"

In April, Wells Fargo shareholders voted down a formal policy outlining its framework for respecting workers' rights to organize, including a commitment to noninterference in the exercise of those rights. The bank had encouraged shareholders to vote against the proposal in a proxy statement ahead of the meeting, calling the initiative "unnecessary and not in the best interests of our employees or shareholders," while saying that the bank remains respectful of employees' rights to organize and collectively bargain "under applicable local laws."