Bank of America has announced a rise in hourly wage for its employees. The nation’s second-largest bank said that it has decided to increase the minimum wage of employees working in the United States to USD 25 an hour. However, the bank said that it would be implemented in a phased manner by 2025. “It would cost a few hundred million dollars every year. But this will be an investment,” CEO Brian Moynihan was quoted as saying by some media reports. Moynihan added that it is about maintaining a “great standard of living.” The bank has just completed the last year task of giving a minimum hourly wage of USD 20.
“Paying employees more helps give them a ‘career mindset.’ This in the long run breeds loyalty. The important thing is that big companies like ours need to set a standard. According to me, it is part of sharing our success with everyone working for the company,” Moynihan said. This is not the first time when the bank has raised the minimum wage for employees under the leadership of Moynihan. The bank is run by Moynihan as the chief executive officer since 2010 and has announced several such measures. The bank had announced in 2017 that the minimum hourly wage of the bank employees would be raised to USD 15. Just two years later, Bank of America said that it would lift that level of USD 20 in the next 24 months. The bank did it ahead of schedule and around 200,000 workers were benefitted from the hike.
Bank of America also said that vendors will have to pay USD 15 an hour to workers. This will impact around 2000 vendor firms and 43,000 workers employed by them. According to Moynihan, around 99 per cent of vendors are already paying USD 15 hourly minimum wage. Meanwhile, other banks too are announcing raise, but not that aggressively. JPMorgan Chase had announced in 2018 that it would increase the hourly wage of around 22,000 employees to USD 18, depending on the local cost of living. Similarly, Citigroup announced in 2019 that raise the hourly minimum wage to USD 15 in 2019.