Wells Fargo (WFC) to Raise Minimum Wage to $15/Hr, Targets $400M in 2018 Philanthropic Contributions
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Wells Fargo & Company (NYSE: WFC) today announced an expansion of its ongoing investments in team members, communities, small businesses, and homeownership, pledging the following actions once tax reform is signed into law:
- Raising the minimum hourly pay rate for its team members to $15 per hour.
- Targeting $400 million in donations to community and nonprofit organizations in 2018. The company also announced that beginning in 2019, it will target 2 percent of its after-tax profits for corporate philanthropy.
- As part of this expanded philanthropy, targeting $100 million in capital and other resources over the next three years to support the growth of diverse small businesses and $75 million in 2018 to its NeighborhoodLIFT® program, an innovative public-private collaboration focused on sustainable homeownership and neighborhood revitalization.
“We believe tax reform is good for our U.S. economy and are pleased to take these immediate steps to invest in our team members, communities, small businesses, and homeowners,” said President and CEO Tim Sloan. “We look forward to identifying additional opportunities for Wells Fargo to invest, as we continue to execute our business strategies and provide long-term value to all our stakeholders. As the nation’s largest small business lender and residential mortgage provider, we understand our significant role in helping grow the economy.”
Investing in our team members
The company’s increased minimum hourly pay rate of $15 for U.S.-based team members goes into effect in March 2018. The new rate is an 11 percent increase to the current minimum hourly rate of $13.50 that the company announced in January 2017.
“We’re ensuring that Wells Fargo is a great place to work by offering market-competitive compensation, career development opportunities, and a broad array of benefits,” Sloan said. “In addition to today’s announcement, over the past year we have added four additional paid holidays per year; enhanced our parental, caregiving, and backup adult care paid leave programs; and announced plans to grant restricted stock awards to approximately 250,000 team members that will vest in two years subject to grant terms. These awards are generally equivalent to 50 shares of Wells Fargo stock for eligible full-time team members and 30 shares for eligible part-time team members.”
Expanding our philanthropic commitment
The company’s plan to target $400 million in donations to nonprofits and community organizations in 2018 is an increase of approximately 40 percent from 2017. Wells Fargo already is one of the top corporate cash donors, ranking first among financial institutions and third among all U.S. companies in a 2016 report (most recent ranking) by The Chronicle of Philanthropy.
“We understand the important role we play in helping our communities, so we will continue to identify additional opportunities where Wells Fargo can make a difference,” Sloan said. “Wells Fargo’s increased philanthropy will have a positive effect on the causes and communities we support and further enhance our Corporate Social Responsibility efforts, which will continue to focus on advancing diversity and social inclusion, creating economic opportunities in underserved communities, and accelerating the transition to a lower-carbon economy and a healthier planet.”
Supporting more small businesses
As part of this increased philanthropy, the company will target investing $100 million over three years, beginning in 2018, to provide access to capital to diverse small businesses through the continuation and expansion of the Wells Fargo Works for Small Business®: Diverse Community Capital (DCC) program. The program provides access to capital, technical assistance, financial services, mentoring and other resources for diverse small businesses that may not qualify for conventional bank loans. Since 2016, the DCC program has invested more than $55 million for diverse small businesses, including those owned by African Americans, Asians, Hispanics, LGBT individuals, veterans, Native Americans, and women.
Creating more homeowners
The company’s $75 million target for the NeighborhoodLIFT® program in 2018 is double the amount of the program in 2017. This innovative program delivers down payment assistance and financial education to homebuyers in collaboration with NeighborWorks® America and local nonprofit organizations. Since February 2012, LIFT programs have helped create nearly 15,500 homeowners in 57 communities across the country, and more than 52,000 individuals have received homebuyer education from NeighborWorks® America members. The majority of LIFT homebuyers are in the low-to-moderate income range.
Gifts to Habitat for Humanity and United Way
As announced earlier this week, Wells Fargo gifted $18 million to Habitat for Humanity International to support its services and to help with disaster rebuilding efforts in Texas, Florida, and Puerto Rico, and an additional $18 million to the United Way Worldwide to support the organization’s efforts to advance the health, education and financial stability of the underserved by helping one million people find jobs over the next five years. Both 2017 gifts will help to build stronger, more resilient communities by increasing access to basic needs such as stable housing, steady employment, and education.
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