Wachovia employees whacked by Wells Fargo

In a move that smacks of corporate retribution, Wells Fargo & Co. has fired 175 employees who left Wells to work at Wachovia Corp.

In a move that smacks of corporate retribution, Wells Fargo & Co. has fired employees who left Wells to work at Wachovia Corp.
In total, Wells Fargo fired 175 of 2,000 Wachovia employees that had previously worked for Wells Fargo, said Melissa Murray, a spokeswoman for the bank.
This month, San Francisco-based Wells purchased Wachovia of Charlotte, N.C., for $12.7 billion.
They initially agreed to the deal in October.
In an almost unheard-of move, the employees that Wells canned include Wachovia registered representatives and investment advisers who work for Wachovia Securities LLC of St. Louis.
That defies one of the fundamental tenets of the brokerage business: High-producing reps and advisers are untouchables in mergers because they are the backbone and revenue producers of the firm that has been acquired.
Before shareholders approved the deal, Wells created a “do not hire” list of the employees, according to several sources inside and outside Wachovia.
According to one source, the list was dubbed the “conflict employee summary.”
At least in several cases, Wachovia Securities employees either were told directly or sent a letter on Christmas Eve that Wells wouldn’t rehire them, those sources said.
Among those affected were Kent Elliott and Matthew Schmitt, a $1.7 million team in Roseville, Calif., who on Jan. 5 joined Robert W. Baird & Co. Inc. of Milwaukee.
The canned employees range from bank tellers to stock brokers, sources said.
Teresa Dougherty, a spokeswoman for Wachovia Securities, wrote in an e-mail on Wednesday that that “there was a corporate-wide HR eligibility process that Wells Fargo went through as part of the merger, and while up to 300 people were affected, only a handful were brokers.”
A day later, Ms. Murray said the correct figure was lower and that all the affected employees were given the opportunity to request a review of their eligibility requirements. As a result, many got their jobs back, she said.
So far, Wells Fargo has not made any other layoffs related to the merger.
She did not give specifics about the criteria employees needed to meet to keep their jobs.
The combination of Wells and Wachovia creates one of the nation’s largest banks, with more than $1.42 trillion in assets, nearly $800 million in deposits and operations in 39 states and Washington.

For the full report, see the upcoming Jan. 19 issue of InvestmentNews.