As states reopen, will credit union branches follow suit?

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Closing branches and limiting access was the easy part.

As the coronavirus outbreak worsened in March, credit unions across the country moved quickly to reduce branch access. That meant moving to a mix of appointment-only visits, drive-thru-only service, increase usage of interactive teller machines and more in order to encourage social distancing and stem the spread of COVID-19.

After more than a month of stay-at-home orders and remote work across the country, however, credit unions now face a balancing act of when — and, more important, how — to begin bringing operations back to normal.

That process is already underway in Georgia, where some restrictions began to lift last week.

Roughly one-third of the employees at Associated Credit Union in Norcross, Ga., have been working from home since March, while the rest worked out of branches and its headquarters. Much of the member-facing business conducted during the state’s stay-home order was done via ITMs, thanks to efforts undertaken in 2019. While no target date has been set, CEO Lin Hodges said Associated’s leadership team has begun having discussions about how to shift operations back to the “new normal.”

“It’s not going to be like it was; it’s going to be a one-size-doesn’t-fit-all approach,” he said.

Hodges noted that appointment-only service may be around for the foreseeable future, while some branches will continue to focus on helping members via drive-thrus and ITMs and others may employ greeters in the lobby who can control the flow of traffic. And some branches — including those where employer groups the credit union serves have shifted to remote work and one located in a VA hospital — may not reopen at all.

“I think we’ll probably come out of this with a smaller footprint,” he added.

Widespread remote work and members’ quick adoption of ITMs has also led the $1.7 billion-asset Associated to realize it is overstaffed by as many as 20 employees, which management intends to deal with through attrition.

Hodges said as Associated begins transitioning employees back to branches, it will probably be done gradually. Roughly two dozen staff members already worked from home prior to the pandemic, and others now at home “are at risk" of COVID-19 "either from age or underlying medical conditions, and they may never come back to work here at the main office or in the branch,” he said.

“When your staff puts their health in your hands, that’s quite a responsibility,” he added. “We take that very, very seriously and we’re not going to do anything that would put their health at risk. We’re going to be very slow, very deliberate and do it right.”

‘Safety, safety, safety’

Even after states reopen and employees return, management will have to ensure staff continues to feel safe on the job, particularly if the virus dies down during the summer but resurfaces in the fall, as some have predicted.

Marcy Goldstein-Gelb, co-executive director of the National Council for Occupational Safety and Health, said return-to-work measures should be conducted in a “phased-in” manner over an extended period of time that ensures the health of workers and the general public.

“How long that phased-in approached requires or who gets phased in first, those are things where workers and employers need to be at the table, and workers are not at the table now,” she said, speaking of the U.S. workforce as a whole and not financial services specifically.

Some credit unions may also be considering modifications to try to reduce the spread of germs. Many branches are being modified with the addition of plexiglass shields between members and staff where possible, and some experts have suggested advanced air filtration systems can help keep clean air circulating and reduce the spread of germs.

Even reducing touchpoints by converting entrances to automatic doors where possible can help reduce risks, but many of those measures may be out of reach for credit unions depending on their size or the layout of their branches.

“Think about what the risks are to workers for reopening and how do you reduce that risk, because obviously you can’t take risk to zero,” said Jessica A.R. Williams, an assistant professor of public health at the University of Kansas Medical Center.

Even for staff who have been working from home, most have still been exposed to at least some risks by going out for groceries. While credit unions can discourage staff from doing things like sharing phones, they must also weigh the situation from an emotional and social perspective as employees adjust to a new work-life balance, she said, adding, “there’s going to be a lot of difficult decisions that have to be made continuously.”

“Every organization needs to do an analysis on what’s the best thing for them and for their members,” said Tim Klatt, director of retail strategies at La Macchia Group. He added: “There’s going to be a lot of variety. It comes a lot down to geography and the density of the virus and the way people are thinking about it.”

In rural areas where the outbreak hasn’t been as severe, he noted, the decision to increase access for members is likely to be easier than in harder-hit areas like New York, New Jersey or Michigan.

Tom Kennedy, president of La Macchia, said some credit unions are also discussing how branch furniture and other fixtures can be rearranged to keep people farther apart.

“Simple things like reorganizing … can have a big impact on social distancing and how that facility operates,” he said.

One of the biggest questions is what happens after branches reopen to wider traffic. If a second round of the virus hits later this year, said Williams, the response “may vary by the place type of business and how bad or good things are. It’s really an ongoing conversation; there’s no gold standard correct answer because you’re balancing lots of different concerns. Some of the lessons we’re learning for how to reduce risk … are lessons that can be carried through and will hopefully be easier to implement in the future.”

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Michigan’s stay-at-home order has already been extended multiple times and isn’t currently expected to lift until at least May 15, but that doesn’t mean credit unions there will see a return to normalcy right away. Detroit remains a hotbed of the outbreak and even other cities continue to see high numbers of cases.

Lansing-based LAFCU began limiting branch access on March 16, and while no decisions have yet been made on when to loosen some of its current restrictions, the shift to emphasize ITM and drive-thru usage is likely to continue, said Chief Marketing Officer Kelli Ellsworth-Etchison.

“We still don’t have a vaccine, so I think it’ll be kind of difficult to go back to business as usual,” she said, noting that even when the stay-at-home order lifts, some elements may be extended.

About 80% of LAFCU’s staff are working remotely now and management is exploring different ways to keep employees and members safe, including widespread use of cloth masks that the credit union will provide to anyone working on-site.

If the mantra of the real estate industry is “location, location, location,” said Ellsworth-Etchison, LAFCU’s mantra in the weeks and months ahead is “safety, safety, safety.”

“That’s our filter for driving all of our decisions: How are we going to keep our members safe, how are we keeping our communities safe and how are we keeping our employees safe,” she added. “Not necessarily in that order, but all three are equally important.”

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