Despite Federal Pay Freeze, 850 NCUA Staffers To Get Pay Increases

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ALEXANDRIA, Va. — Most NCUA employees, among the best-paid in the government, will escape a two-year freeze on federal worker pay ordered by President Obama last month as the agency's examiners' union is preparing to implement a new two-year contract that will award raises as much as 8% a year.

The president of the union, the National Treasury Employees Union, said last week she expects the new collective bargaining agreement to be implemented by NCUA despite the President's Executive Order. "It would be unlawful to abrogate such agreements, and the president's Executive Order and implementing memorandum to agency heads and Office of Personnel Management guidance on the subject direct agencies to follow the law," Colleen Kelley, president of the union, told Credit Union Journal.

NCUA conceded it has no authority to block the raises for the union employees, but will enforce it for the agency's 250 other employees, most of them executives. "This pay freeze affects federal workers whose salary increases were not negotiated under existing union contracts. NCUA will certainly honor the pay freeze for all affected employees - and we will reduce our budget accordingly," said NCUA Chairman Debbie Matz this afternoon. "They are public servants who, like their private sector counterparts, may be struggling in these difficult economic times. So, many NCUA employees will be making their own sacrifices along with credit unions. But I assure all stakeholders: NCUA will not sacrifice safety and soundness as we work to help the credit union industry recover in the coming years" (see related article, page 7).


Merit Raises of 5.1%

Under federal labor law, a presidential Executive Order or a government-wide regulation in conflict with an existing collective bargaining agreement must wait implementation until the agreement expires. The contract calls for the 850 union members to receive merit pay raises averaging 5.1% in each of the next two years, and so-called locality raises of as much as 3% in high-cost locales, like the Washington, D.C., metro area where NCUA is based.

The raises, coming while inflation is below 2%, have raised controversy among credit unions as they have fueled a 13% rise in NCUA spending for next year, which will be paid by credit unions.

The union's Kelley asserted that NCUA employees have already earned their 2011 merit raises over the past year.

"It would be unjust for employees not to receive the performance-based pay increases they have worked so hard to achieve," she added.

The NTEU represents more than 150,000 workers at 30 federal agencies, including FDIC, Office of the Comptroller of the Currency, the Securities and Exchange Commission, Department of Agriculture, Environmental Protection Agency, Internal Revenue Service and the Department of Homeland Security.

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