Wells Fargo Bank is putting the pieces together after the sales team compensation scandal in September 2016. Post scandal, the OCC announced that it would review sales incentive practices at all the large and midsize banks it supervises. Bankers have been watching what Wells Fargo would do to appease the OCC and other critics of its performance-based pay strategies. Wells Fargo's new plan doesn't eliminate incentive pay entirely. But, the new plan draws Wells Fargo in line with compensation plans that are common throughout the retail banking industry.
Sales quotas based on account opening data are gone. Compensation is based primarily on salary. Bank tellers' compensation is 95% salary. Entry level bankers' get incentive pay based on the performance of their team, not individual sales results.
What will the reputational damage and tilt in compensation toward base pay and team results mean for Wells Fargo's ability to recruit and retain the best bankers? American Banker reports that pay cuts for current employees are in the offing and morale is low.