Striking Out On Their Own

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Kemba Charleston FCU board members logged more than 1,000 vehicle miles recently to assure striking Kroger employees that their credit union was willing to help.

"Our main sponsor is the Kroger Company," said Joetta Heck, manager of KCFCU, referring to the Cincinnati-based grocery chain. "And we have members at all 44 stores-in West Virginia, Ohio and Kentucky."

She said that several weeks into the strike that began on Oct. 13, board members and staff weren't sure that their members knew the credit union had financial options available, including extension agreements and consumer counseling to help them get through the crisis.

At the same time, the credit union has prepared itself for an outflow in deposits and the resulting decrease in assets.

"Assets are sliding backwards somewhat," Heck said after the sixth week of the strike that has left 44,000 employees without regular paychecks.

During a normal week, she said, the CU averages $200,000 in deposits. The first week after the strike, it collected $7,000, much of it in increments of $100-compensation to striking employees. "This week we are getting $13,000," she told The Credit Union Journal.

The $32-million Kemba Charleston FCU does have 19% capital "which is going to go a long, long way," she said. "We're right on track for a decent income spread."

Still, Heck said, the board was not happy that so many of its members were at risk of financial crises. "They just hated the fact that the delinquencies were coming in and the members weren't talking to us," Heck said. "We didn't want to have to report them to the credit bureau."

She said board members wondered if their members even knew KCFCU was willing to help.

At issue between the workers and their employer is the amount the latter is willing to pay for health benefits; an issue that led to similar strikes at separate grocery stores on the West Coast. Employees said the latest offer isn't enough to cover their current plan, and thus reduces their benefits package. Both sides predict the standstill will last at least through the end of the year.

"Our biggest challenge was getting the word out," Heck said. "Even though we contacted the union hall explaining the pyramid of options, response was limited. We didn't know if they were passing the message along or if a notice was just stuck on a board somewhere."

She said board members took that "personal service" philosophy above and beyond the call of duty when they decided to travel to each of the strike locations to make sure their members were aware of their financial options.

Before they revved their engines, Heck said, board members participated in her one-hour training session. They left armed with cheat sheets as well.

Ron Turley, board chair and a retired Kroger employee, and Calvin Holden, a board member who is also a striking worker, stopped at every Kroger store between Dunbar and Ashland, Kentucky, and then crossed the river and traveled on to Marietta, Ohio.

"They traveled some 300 miles in one day," Heck said, adding that a third board member, Orville Shaffer, a retired Kroger truck driver, traveled 200 miles that same day to visit the stores in the local area before crossing into Beckley, W.Va.

"When they returned after dark, they had a good feeling that they were well received," Heck said. "They said people seemed very appreciative."

Supervisory committee member and Kroger store supervisor Roger Curry spent the next day traveling 350 miles in pouring rain to reach stores in Buckingham and Elkins, W.Va. After a night's sleep, he traveled another 180 miles to a store that had been missed.

Heck said Holden and Turley made two more trips the following weekend. And, after a phone training session and materials via mail, Georgia Smalley, chair of the supervisory committee, helped finish the task by visiting stores in Lewisburg, W.Va.

Heck said the effort has been worth it. Besides the phone inquiries, the credit union is now processing "hundreds" of extension agreements.

The agreement allows the borrower to bump payments for four weeks. They can get up to three extensions per loan for a total of 12 weeks.

Heck said interest will still accrue, so CU staff is encouraging members to keep up on those payments. For those who feel they are getting too deep in debt, Kemba Charleston is offering credit counseling.

The downside for the 11-member staff, she said, is the extra work. Each loan that a member has-one to five-requires its own set of paperwork. And each time that extension is renewed, the paperwork has to be done all over again. And while striking employees are still receiving strike pay in increments of $100, the checks aren't direct deposited. That means more paper checks to deposit and more paperwork to cover loan payments that otherwise would have been deducted from their accounts automatically.

Throughout the difficult situation, the credit union has also been thinking about the future, she said. "This morning we have been very busy trying to see what kinds of loan specials we could put together (once the strike ends)."

Heck wanted to express her gratitude to her staff that has pulled together despite more than their share of challenges. "It has been an absolute whirlwind," she said. "We have had a lot of personal setbacks within our credit union family, which makes it even more amazing that we are able to keep up and be able to pull this off."

Heck said her collector was out for six weeks after a scheduled surgery, a loan officer lost her home to a fire, an employee learned that she had cancer, and "I lost my nephew a few weeks ago."

Heck, by the way, was hired as manager of the credit union only a month before the strike

She described her staff and board as having "hearts of gold. They truly wanted to do these things for the members because it's the moral thing to do."

"We make very little income from fees," she continued. An example-NSF charges are still only $10 when other area financial institutions are charging $25.

"We really just try to be that old-time credit union," Heck said. "It's worked for us very well up to this point and it will see us through this situation."

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