HRM : The Effects of HR Decisions

Week 14. Case 10 — Wells Fargo

The employees at Wells Fargo were under a lot of pressure from their management. The company’s managers had no ethical values when making their employees operate like this, and it was very systematic. Some of the employees said that their managers would yell at them and act as they didn’t know what they were doing to their customers. When the scandal finally came out the lowest level employees were fired, since they were the ones doing actually scamming the money from the customers. This was a very well organized fraud the company’s management used to make them and the company more money, exploiting the lower level employees, since they would do anything to keep their jobs. Many employee contacted the company ethics line and HR department about what was going on, and were fired a week later for tardiness, retaliation and other bogus reasons. In the end when the scandal came out, the law got involved and brought justice to the case. After contacting many employees involved more instances of employee abuse was revealed. The managers would make the employees stay after hours, without any overtime pay, to meet their sales goals. The company had a very systematic way of even handling the whistleblowers. A few tried suing the company for wrongful termination, after they had tried informing someone about what was happening in the company, but many lost their cases. Wells Fargo was running a corrupt scheme in there company for almost 10 years. Forgetting the company ethics totally and putting profit before employee wellness and the law. They even tried to handle customer complaints discreetly, so that the law would have a small amount to know, and other customers wouldn’t come seeking for the same rewards.

In my opinion the biggest issues are the company’s core ethical values. The employees were being systematically bullied, and kept quiet by the fear of getting fired. This is one of the issues with big companies outsourcing their HR department, they have no idea what’s actually going on. In this case the HR department was even corrupt. I think as an employee this situation would be very difficult. Clearly many of the employees livelihood was depending on this job and they could not afford to loose it, or take their termination case to court. I do not know if these people belonged to an union, but I think being in a union would’ve helped them enormously and brought the issues to public a lot earlier. I still did not get the HR departments side of what was happening quite clearly, but it seems like they were being manipulated somehow to keep this scam going. The higher level employees had abandoned all ethical and moral values for money. Big companies think they can always mistreat their bottom employees, because they are easily replaceable. For companies this creates large employee turnover, which puts a larger amount of money to train the new employees always. If the companies require a small amount of knowledge and training, they do not really care about the employee turnover ratings. Another case of a large company putting their own needs before the customers is the incident with United airlines violently removing one of their passengers, so a staff member could take the flight. I think the law set a good example with Wells Fargo what will happen to you if you put profits before employee and customer wellness.

Below you may find all of the news articles that were studied for this blog post.

Sources:

United Airlines says controversial flight was not overbooked; CEO apologizes again. John Bacon and Ben Mutzabaugh. URL: https://www.usatoday.com/story/news/nation/2017/04/11/united-ceo-employees-followed-procedures-flier-belligerent/100317166/ . Accessed 1.5.17.