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CFPB to Drop Contentious Employee Evaluation Program

WASHINGTON — The Consumer Financial Protection Bureau is planning to eliminate its current employee performance management system after data showed minorities were rated lower than white employees.

The change comes in response to an American Banker article that showed the agency's white employees had a greater likelihood of receiving the highest rating in performance evaluations than minorities.

After the story ran on March 6, CFPB Director Richard Cordray sent an internal letter to staff promising to address the performance reviews and other issues. By Monday, the agency decided it would change the performance review process, according to an email sent out to several media outlets.

"The CFPB will move away from its current performance management system," said Jen Howard, a CFPB spokeswoman. "We have agreed to work together with the union on a system that is consistent with our shared commitment ato excellence, equality, and fairness."

(The CFPB did not provide the email to American Banker, despite requests. It was obtained through sources.)

In the letter to employees, Cordray said the agency is working with the National Treasury Employees Union on next steps to take and is in the process of hiring an outside consultant to "interpret the data and do a comprehensive review and analyses of the ratings data. "

"I want you to know that we take these issues seriously, and if there are problems we want and intend to have them fixed," Cordray stated. "Depending on what the ongoing review finds, we will take appropriate corrective actions and communicate them to you. In the meantime, we have begun taking steps to strengthen our performance management system and to improve managers' skills."


(4) Comments



Comments (4)
Before emotional conclusions are displayed. Let's see if in fact there was discrimination, as currently we have no facts other than a clasification of minority having lower performance scores.

Though, the incompetence of the CFPB under the leadership of Director Cordray is well documented in the regulations created. The QM rule that allows a debt-to-income (dti) of over 43% only for loans from the Federal Government or GSE's under Federal Government Conservatorship. If a > 43% dti is bad for the consumer, why is the exact same loan from government agency not bad? In QM rule, why is a Mortgage Brokerage income from YSP/SRP not treated the same as nonMortgage Brokerage YSP/SRP income? Exact same loan with disparate treatment for consumer.

We can only hope the consulting firm doing analysis of employee performance data is truely independent, though I suspect they will behave on the instructions of those doing the hiring. Attorney Cordray practiced that in selecting expert witnesses to validate his cases; just as opposing counsel had their expert witnesses validate the counter point.
Posted by NoSpin_JustFacts | Tuesday, March 11 2014 at 4:29PM ET
Hard to justify the management philosophy of an agency dedicated to fair treatment of consumers when it translates into unfair treatment of its employees.
Posted by jim_wells | Tuesday, March 11 2014 at 11:30AM ET
Kudos to American Banker for covering this issue. The agency was sitting on this information for quite some time. It wasn't until after AB reported the story did the agency decide to engage a third party consultant and implement a compliance management tool. And just to be clear, it was the union who initially requested the demographic break down of ratings after noticing a disturbing pattern in grievances. While the agency may have informed the union of the disparities, not every employee is a member of the union so they would not have known about the disparities had AB not ran the story. On top of that, the current PMR process has no mechanism to appeal adverse ratings. The only way employees can appeal ratings is if they file a grievance through the union. It is left unsaid how much employees have lost in pay going back to 2012 and whether employees harmed by the discriminatory PMR system will be remediated, as would be expected by a bank or financial institution.
Posted by Bob White | Tuesday, March 11 2014 at 10:26AM ET
Frightening to think that this new federal regulatory agency would establish a performance management system that embodied exactly the type of discriminatory practices that it was aggressively targeting at the financial companies it supervises. Making matters worse, the agency agreed to change its discriminatory personnel policies only after they were highlighted by American Banker and picked up by other media, NOT when they were surfaced and challenged by employees.
Posted by jim_wells | Tuesday, March 11 2014 at 8:55AM ET
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