Bank of America employees who earn less than $100,000 a year will receive a base salary raise of up to 7% next month, depending on how long they’ve worked for the company, according to a memo seen Tuesday by Bloomberg. The raises will start at 3% for workers who joined the bank in 2021, the wire service reported.
That would be the second pay-related initiative the bank has launched this week — after announcing Monday that it is boosting its minimum hourly wage to $22 from $21.
And here, two patterns are beginning to emerge. First, the nation’s second-largest bank has taken to announcing pay bumps in pairs.
It said in January it would give bonuses of 65 to 600 restricted stock units — worth between $2,900 and $27,000 — to 97% of its workforce, with the caveat that employees who earn more than $500,000 a year are ineligible.
Two days later, the bank announced a string of compensation boosts for higher-level executives. Namely, managing directors in investment banking and markets would get a $100,000 base salary raise to $500,000; directors would get a bump of $50,000 to $100,000; and smaller-increment raises would take effect down the ladder.
Second, Bank of America appears to be making a more concerted — or at least more publicized — effort than other banks of its size to invite its rank and file to a bigger share of its success.
This week’s minimum wage bump and time-dependent raises stand in contrast to one-off multimillion-dollar stock bonuses JPMorgan Chase and Goldman Sachs made to top executives, raising red flags among proxy advisers. JPMorgan, for example, defended the $50 million-plus share options package it gave CEO Jamie Dimon as a reflection of the board’s “desire” that he “continue to lead the Firm for a further significant number of years.”
Banks have strengthened their efforts to retain lower-ranking talent, too. The banking industry writ large pushed starting salaries for junior investment-banking analysts past the six-figure threshold last year in response to a presentation 13 Goldman bankers made to their supervisors, detailing “inhumane” working conditions.
Bank of America stands out for the number of efforts it has made to retain non-specialized talent — particularly amid an environment where inflation is outpacing typical cost-of-living pay increases.
The Charlotte, North Carolina-based lender launched a separate, albeit niche, perk this week — offering $4,000 in reimbursement to employees who buy an electric vehicle, or $2,000 toward a new lease, Bloomberg reported. Workers with at least three years at the company whose salaries are less than $250,000 per year can take advantage of that benefit starting in July, the wire service reported.
The attention the bank is lavishing on its rank and file in 2022 could position it as a thought leader with regard to benefits, taking up a mantle Citi held in 2021, when it became the first bank of its size to promote a hybrid schedule for the majority of its workforce.