Wells Fargo is temporarily suspending a hiring policy that prompted some managers to conduct mock interviews with non-white and female candidates after a New York Times report highlighted the practice, the bank’s chief executive officer, Charles W. Scharf, told employees in one letter with Monday.
The bank’s “Diversity” policy, introduced in 2020, required that at least half of candidates interviewed for vacancies with annual salaries of $100,000 or more had to be “diverse” — a collective term for ethnic minority women and members of other disadvantaged groups.
Although a version of the policy had been in place for years, Wells Fargo executives put it into writing in mid-2020 as part of a broader push to increase diversity at the bank. On Monday, Mr. Scharf told employees the policy would be suspended for several weeks to give bank executives time to study its use and make changes.
The pause would allow the bank to gain confidence that “the policy will deliver on its promise” and that “hiring managers, executives and recruiters fully understand how the policy should work,” Mr. Scharf said in the letter.
The Times reported on May 19 that a former wealth manager at the bank complained that he was being forced by his bosses to interview employees for positions already promised to others just to meet the “diversity” requirement fulfill.
The man, Joe Bruno, was one of a dozen current and former Wells Fargo employees who said they witnessed or participated in fake interviews. Some of the employees said mock interviews were also conducted for jobs paying less than $100,000. The purpose was to record the fact that “different” candidates were being interviewed if bank regulators were considering whether Wells Fargo was giving minorities a fair chance to find jobs, they said.
After the Times report was published, lawmakers including Senator Sherrod Brown, a Democrat from Ohio who heads the Senate Banking Committee, criticized the practice. Mr Brown wrote to Mr Scharf urging the bank to settle their problems “once and for all”. Massachusetts Sen. Elizabeth Warren, also a Democrat, cited the report in a May 20 tweet calling for Wells Fargo to be disbanded.
Mr Bruno was fired last August after complaining to his superiors. Bank employees said in messages to employees after the Times report that the fake interviews were isolated incidents that did not comply with the bank’s policies.
In his letter, Mr. Scharf said the bank had reason to believe the Diverse Slate policy was working. For example, in 2021, 42 percent of people hired for jobs paying $100,000 or more were from a racial or ethnic minority, a five percentage point increase from two years earlier, before the “diversity” policy was introduced.
But Mr. Scharf said in Monday’s letter that members of the bank’s operations committee – which includes senior executives – had concluded that there were “opportunities to improve our execution of some of our activities”.
Mr. Scharf said the “Diverse Slate” policy will be suspended for several weeks to allow senior executives to “review our policies and processes and make improvements.” Once the review is complete, he added, Wells Fargo will “make adjustments to our diverse slate program as appropriate and restart it during the month of July.”