Wells Fargo has suspended a hiring policy that required executives to interview several candidates before offering anyone a job, the banking giant confirmed to CBS MoneyWatch.
“Since The New York Times ran a story last month about various lists of candidates at Wells Fargo, I’ve had the opportunity to hear from many of you,” said Charles Scharf, the bank’s CEO, in the memo to staff this week. “In these sessions, you described in very personal terms the career obstacles you faced because of who you are.”
The break comes three weeks after former employees told The New York Times that Wells Fargo often forced them into “fake interviews” with a person of color, even though they weren’t supposed to actually hire the person. One former employee in particular — Joe Bruno — said he was fired for speaking out against the fake interviews, the Times reported.
Wells Fargo will amend the policy, retrain hiring managers and relaunch the policy next month, Scharf said in the memo. The company still plans to interview and hire candidates of color in the meantime, he said.
Wells Fargo, the country’s third-largest bank, passed the policy two years ago in an effort to increase diversity in the workplace. The policy requires hiring managers to interview at least one woman and one person of color for job openings, especially those with a salary of $100,000 or more. According to company data from 2020, black people made up 13% of Wells Fargo’s US workforce and 17% Hispanics.
Other companies, such as Adobe, Best Buy and Pinterest, have introduced similar mandatory interview measures to promote employee diversity. However, the technique has come under criticism from experts who say it often boils down to a crappy quota of not moving the needle. Hiring executives just ticks the box for diversity interviews and then hires the candidate they’ve always planned to bring on board, experts told CBS MoneyWatch.
“The quotas were created because workplaces don’t know what to do differently,” said Kim Crowder, owner of a company that advises on diversity, equity and inclusion in hiring. “Companies use these as window dressing to make things look like they’re progressing.”
In 2020, Scharf said Wells Fargo was struggling to attract a diverse workforce due to a “very limited pool of black talent”. he later†
No quick fixes
Since the murder of George Floyd in Minnesota two years ago, there has been increased social pressure on corporate America to hire more workers of color and provide them with equal pay, growth opportunities and more inclusive work environments.
But little progress has been made in the financial sector over the years, according to research by the federal government and think tanks. Whites continue to dominate executive and C-suite positions at most major banks and insurance companies, studies have shown.
Crowder said Wells Fargo’s policy may have failed because it relied solely on job interviews as a solution to the larger problem of low diversity at the company.
“Correcting something in a month that’s been going on for years makes no sense,” Crowder told CBS MoneyWatch. Adopting diversity “is an area where companies always want quick solutions.”