Daily Labor Report® is the objective resource the nation’s foremost labor and employment professionals read and rely on, providing reliable, analytical coverage of top labor and employment...
By Rhonda Smith
July 21 — Bank tellers are some of the lowest-paid workers in the U.S., and JPMorgan Chase's recent decision to raise its minimum hourly wage to between $12 and $16.50 over the next three years isn't enough, employee advocates say.
Banking industry officials, however, said their starting hourly wages are above the federal minimum wage, which is $7.25. They also describe the minimum wages they offer as competitive.
Minimum hourly wage rates at the other largest banks nationwide—Wells Fargo, Bank of America, Citibank, U.S. Bank, Capital One, PNC Bank, Bank of New York Mellon, TD Bank, and State Street Bank and Trust—are in the same ballpark as JPMorgan Chase's pay, according to PayScale Inc. data and details some of the companies shared with Bloomberg BNA.
The American Bankers Association ranks the largest 50 institutions by consolidated banking assets, using data from the Federal Deposit Insurance Corp. JPMorgan Chase is No. 1 on the list.
But in an industry the ABA said holds more than $16 trillion in assets, pay rates that hover around $15 an hour should be much higher, especially for tellers, those pushing for change said.
“$15 an hour for workers at the bottom should be the bare minimum asked of the banking industry—a highly profitable multi-trillion dollar sector,” Paul Sonn, the National Employment Law Project's general counsel and program director, told Bloomberg BNA July 20 in an e-mail.
“America’s banks are dedicated to attracting and retaining top talent at all levels by ensuring they are compensated appropriately for their efforts,” Mike Townsend, a spokesman for the ABA, told Bloomberg BNA July 21. “Many banks offer career development training opportunities to encourage the advancement of high performers.”
When Jamie Dimon, chairman and chief executive of JPMorgan Chase, announced new wage rates in an opinion piece in the New York Times, July 12, he said the bank plans to invest more than $200 million this year “on training for thousands of entry-level employees in our consumer banking business.”
Sonn said, “But banks like First Republic Bank—which raised pay to $20 an hour and saw profits increase—are showing that the industry can and should do even more. The equivalent for the banking industry of what $15 per hour represents for fast food, as a portion of operating costs, would mean an even larger increase.”
California-based First Republic noted in its employee benefits brochure that the bank pays a $20 minimum hourly wage to full-time, part-time and temporary employees, including interns.
Advocates for better pay in banking are riding on the coattails of the Fight for $15 campaign, launched in late 2012 by fast-food workers in New York City. The campaign is fueling a growing push nationwide for higher pay among retail, warehouse, home care and other employees.
Tellers and customer service representatives in the banking industry are adding their own financial spin to the movement.
The 446,620 bank tellers in the U.S. earn a median hourly wage of $12.77, according to 2015 Labor Department data, the latest available.
Seattle-based PayScale, which has a database of 54 million individual salary profiles, said on its website that an average bank teller in the U.S. can expect to make about $10.87 per hour in starting pay. But rates vary, depending on the region in which a worker resides.
Almost 75 percent of U.S. bank tellers earn less than $15 per hour, NELP said in an issue brief it released last year. The group also said about 44 percent of bank customer service representatives earn less than that amount.
The banking industry is marked by two extremes, NELP said.
“At the top, high-profile executives often receive millions in compensation,” it said. “But at the bottom, hundreds of thousands of bank workers make less than living wages.”
In addition, the organization said, bank tellers have seen the real value of their paychecks diminish—as the cost of living has risen, their wages have stagnated.
Between 2009 and 2014, it said, real wages for bank tellers declined 3.4 percent.
Hourly wages in the banking industry aren't keeping pace with this decline, proponents of higher wages contend.
PayScale said that with some bonuses approaching $1,000, and certain profit-sharing proceeds reaching $3,000, total annual incomes of bank tellers can range from $18,000 to $30,000, “depending on individual performance.”
Wells Fargo's hourly wage rate ranges from $12 to $16.50, depending on the bank's location and a worker's experience level, company spokeswoman Aimee Worsley said July 15.
“While we expect to continue to increase beyond our current levels over the next three years, it wouldn't be accurate to attribute any of our future changes to JPM's announcement,” she said in an e-mail message, “particularly since we are already paying at the rates JPM announced it will move to over the coming years.”
Citibank employees enjoy the largest paychecks, PayScale said, and $28,000 a year is the median salary there.
Tellers at Citibank earn an average of more than $15.50 per hour in the U.S., company spokeswoman Deirdre Leahy told Bloomberg BNA July 18. New and junior staff members receive a minimum hourly wage of $13.
“We care a great deal about our employees and the competitiveness of the compensation we provide,” she said.
Bank of America, TD Bank and SunTrust Banks Inc. also offer top salaries for bank tellers, according to PayScale data. Workers at those three banks can all expect to earn $25,000 a year, the company said on its website.
“We're committed to paying all of our employees competitive wages, and we invest considerable time in educating and supporting our managers to make sound and market-informed pay decisions,” Andy Aldridge, a Bank of America spokesman, told Bloomberg BNA July 18, citing the bank's environmental, social and governance report.
Aldridge declined to disclose the bank's minimum hourly wage.
“In particular, we monitor the compensation of employees who are paid hourly to ensure their wages are competitive with industry trends,” the bank said in the ESG report. “To that end, we pay our U.S. employees significantly higher than federal, state, and local minimum wage requirements.”
TD Bank raised its minimum hourly wage last year, Judith Schmidt, a spokeswoman there, told Bloomberg BNA July 18.
“Not only was this the right thing to do for our business, but the right thing to do for our people,” she said. “TD has long understood that employees help drive our company's success.”
She declined to divulge what TD Bank's minimum hourly wage is today.
Bank tellers at PNC Financial Services Group take home the smallest paychecks, and $21,000 is the median salary, PayScale data show.
The bank's pay range is narrow, PayScale said, with annual salaries starting at $18,000 and rising to $26,000.
Other banks PayScale identified as having “a reputation for below-average pay” include Fifth Third Bancorp ($21,000 a year), Federal Credit Union ($22,000) and U.S. Bank ($22,000).
U.S. Bank spokeswoman Teri Charest, declined to comment for this story. (Bloomberg BNA contacted the 10 largest banks in the nation. U.S. Bank is ranked No. 5.)
PayScale said that for bank tellers “experience doesn't seem to be a major factor in determining pay.” Those with limited experience can expect to make around $22,000 a year, it said. Those with five to 10 years of experience have an average annual salary of $25,000.
The National Employment Law Project noted in a chart documenting employers that have increased their hourly wage to $15 or more that besides First Republic's $20-per-hour starting wage, Florida-based First Green Bank's minimum hourly pay rate is $14.90.
Both C1 Bank in Florida and union-owned Amalgamated Bank, based in New York City, offer minimum hourly wages of $15.
In addition to promoting higher wages, employees in the banking industry are increasingly speaking out about employer requirements that they meet aggressive and unethical sales quotas, the Communications Workers of America charged in June, during a briefing on Capitol Hill.
The CWA is trying to organize workers in the banking industry. It is part of a coalition of bank employees and advocacy groups known as the Committee for Better Banks, which is pushing for industry reform.
Several bank employees at the briefing said they face pressure to encourage customers to apply for financial products, such as credit cards, that might not be in a consumer's best interest.
In October, bank workers from across the U.S. met in Los Angeles to protest what they described as declining working conditions at banks, including at JPMorgan Chase and Bank of New York Mellon, the eighth largest bank in the U.S.
Coalition members' demands included “a fair share of the profits banks workers create, an end to unreasonable sales goals,” they said in a statement at the time, and “access to full-time and stable employment.”
To contact the reporter on this story: Rhonda Smith in Washington at email@example.com
To contact the editor responsible for this story: Susan J. McGolrick at firstname.lastname@example.org
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)