Layoff Prep and Key Dates

I am inspired by others here who are willing to do the job that our "leadership" is not. That is, to share actual information.

Here are some key dates at Wells Fargo which are based on what has happened in past years.

March 15th - Bonuses Paid. Must be currently employed to receive.
April - Profit Sharing paid out (typically 1% into 401k in the form of WFC stock).
Early April - 401k Match for Q1 in the form of WFC stock
June 30th - Last day for Profit Sharing contribution for PRIOR year posted to 401k accounts.
Early July - 401k Match for Q2 in the form of WFC stock
Early Oct - 401k Match for Q3 in the form of WFC stock
Dec 31st - Must still be employed on this date to get "profit sharing" contributions to 401k for next year. Not eligible if you are or have been on "Salary Continuation".
Dec 31st - 401k Match for Q4 in the form of WFC stock

COVID-19 may be used as an excuse to cut future bonuses and profit sharing. Likely in 2021.

In terms of who or how many FTE's are being laid off, we have no information. However we do have some numbers for contractors.

Nearly 19,000 contractors will reach end of term by the end of 2020.
Nearly 15,000 more contractors will reach end of term by the end of 2021, with an unusually large number of them ending on 2/28/2021.

We assume that most of these contractors are reaching the normal end of their contracts, with the possible exception of the burst at 2/28/2021. We also know that there is a hiring freeze, so these contractors won't be coming in through the back door as new FTE's.

There is a grand total of about 35,000 contractor headcount that will be gone by the end of 2022 as it stands today. Combined with the already known headcount reduction target of 25,000 FTE's, the amount of savings could be calculated by someone who knows the average pay rates. I do not have access to that information.

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One correction to the original post. You do not have to be employed at Wells to get a bonus. If you, for example, leave or retire, in July, you are eligible for 50% of your bonus. I know of many ex Wells employees that received their pro rated bonus in March. As a manager, when this occurred, I received an email with the name of the ex employee and what they were eligible for. Now will this be the case in 2021? Your guess is as good as mine!

An additional wrinkle in some of the above analysis - India and Philippines headcounts will likely increase - I've heard of them potentially increasing by 2X - which means on-shore headcounts need to be reduced to cover those off-shore increased headcounts.

Let me help you with that math.

The average annual cost of a person at WF is said to be $166k per year. I can't substantiate that, and I think it's on the high side because of skewing due to executive mega-salaries.

So lets use $150k as our number. That's close enough for a ballpark estimate.

35,000 contractors leaving (and assuming they won't be replaced, which they are not in my business unit) plus 25,000 FTE's being laid off (which has already been communicated) is a total headcount reduction of 60,000 by the end of 2022.

60,000 times $150k is 9 Billion dollars. That's close to Chuckie's 10 Billion dollar goal. And if we use that $166k number and some pocket change it's VERY close to his goal.

There you have it. $10B in savings.

It's only a matter of how fast they do it. And who they hurt along the way.

Year end reviews, merit cycle and bonuses paid time frames are all likely to be changed. HR presentations to managers when they were going over mid year changes mentioned the year end reviews and compensation planning being moved up to year end without a lot of details so it stands to reason the other dates likely will be moved too.

"Question: where do you get the 25k target FTE reduction?"

Posted here many times. Has to do with our efficiency ratio (revenue per employee) as compared to the other banks. the estimate is just that, an estimate. an educated guess assuming that WF leadership wants us to be in line with the other banks, namely JPMC who has the best efficiency ratio. Something like over $400k per employee. The data is all on csimarket.com

Count is 50K - 75K

Will be much more than 25k FTEs

Closing branches and selling bank owned branches and offices will help tremendously. Its too bad those that work in branches are not exactly high income employees and it will be hard for those to find decent replacement jobs in this market.

Contracts are often cut short...when I contracted with WF, WF had hiring freeze and layoffs right after I started, and all of the contractors in our division were let go. My contract lasted 3 weeks.

Pretty awful since I turned down 2 other gigs to take the WF one, but that's the ugly side of contracting.

Even FTEs in "at will" states can be let go at a moment's notice.

Are there areas that are notoriously safer than others?
Like Home, Auto and Retail are getting hit probably but what about CIB Middle office or DMI?

That is a lot of contractors....holy cow. How did this happen?!

The previous regime "intended" to cust about that many jobs. However, that doesn't include the inevitable branch closures. I believe that around 70 have already been identified and reported to the OCC and that # will certainly only get larger. Interesting times.

Question: where do you get the 25k target FTE reduction?

Thread regarding Wells Fargo & Co. layoffs

Layoff Prep and Key Dates

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