This is the first line in a full-page article run by Wells Fargo Bank last week in major newspapers. They placed the ad to announce that they'd succumbed to political correctness and acquiesced to public pressure, canceling all major employee recognition and rewards events for the rest of the year.

What a shame!

Because Wells took money from the Federal Government's U.S. Capital Purchase Program, they're mandated to follow the government's executive compensation requirements. The company's stock value has significantly decreased over the past year, particularly since they acquired Wachovia. The new Federal regulations will only result in creative recommendations from executive compensation consultants to ramp up the base salary or preferred stock holdings of these executives in order to attract and retain key talent in these jobs.

But what about the little guy?

Wells Fargo Bank has a tradition of holding annual events to recognize their high-achieving employees in front of their peers. They pay for these events out of their profits; not taxpayer money. They budget for these events every year. Their employees count on it as a part of their total rewards package; something to look forward to as a well-deserved break. These recognition events don't fall under the jurisdiction of government regulations and control for executive compensation.

The media succeeded in getting everyone worked up into a thither about over-the-top expenditures including executive junkets planned by AIG, cash bonus payouts from Merrill Lynch, corporate jet purchases from the automakers, and other poor examples demonstrating greed by companies in crisis.

Obviously, in those cases it wasn't appropriate to spend taxpayer money on corporate jets, cash bonuses or other frivolous expenditures. Where in the world were these companies PR experts? Hopefully, they've been laid off and that function has been outsourced!

Wells' believes that their profits actually increase from recognizing and rewarding their highest performing employees. Considering that these employees won't receive a bonus which would have resulted in increased consumer spending, there's a negative multiplier effect at play that will be mirrored by many other companies who succumb to political correctness.

What's more, employees from hotels, airlines, restaurants and entertainment will suffer through reduced income from this significant loss of this business. It's easy to envision the negative, direct financial impact that will affect thousands of employees and their families. We all lose under this scenario, because the economy will continue in its downward spiral when this situation is multiplied by thousands of corporations who cut back on recognizing their top performers.

"Competition to be recognized inspires everyone to work harder and smarter. We're as frugal as any company in spending our shareholders' money thoughtfully and responsibly. Events such as this are the heart of our culture because our product is service, delivered by caring, energized, talented, loyal team members who earn competitive, fair wages and benefits." John Stumpf President & CEO Wells Fargo Bank

I agree, Mr. Stumpf. Something doesn't feel right.

Copyright 2009 Regan HR, Inc.