Federal Pay Remains Unsettled
A bill passed Oct. 5 by the House of Representatives that would grant back pay to furloughed federal employees in the government shutdown stalled in the Senate. As of Oct. 10, the Democratic-controlled Senate had yet to vote on the bill, which passed 407-0 in the Republican-controlled House.
Under the Federal Employee Retroactive Pay Fairness Act, “federal employees furloughed as a result of any lapse in appropriations which begins on or about October 1, 2013, shall be compensated at their standard rate of compensation, for the period of such lapse in appropriations, as soon as practicable after such lapse in appropriations ends.”
The House version of the bill, sponsored by Rep. Jim Moran (D-Va.), had 177 co-sponsors. Sen. Ben Cardin (D-Md.) sponsored the legislation in the Senate, which currently has 27 co-sponsors.
Even though the bill has not been put to a vote yet in the Senate, Cardin’s office said the legislation is still a priority for Senate Majority Leader Harry Reid (D-Nev.).
“Senator Cardin has talked to Leader Reid. The bill remains a priority,” a spokesperson for Cardin told Credit Union Times Oct. 9. The spokesperson was not aware of a timeframe for a vote on the legislation. Reid’s office did not respond to a request for comment.
On the Senate floor, Reid labeled the legislation “cruel” after it passed the House.
“It’s really cruel to tell workers that they’ll receive back pay once the government opens and then refuse to open the government,” Reid said Oct. 5 as reported by CBS News.
“What they’re telling all these federal workers: ‘What we’re going to do for you now, even though we don’t like federal workers and we haven’t given you a raise in three years, what we’re going to do now is give you a paid vacation,’” the Nevada senator also said.
In the meantime, many credit unions offered assistance to federal employees affected by the Oct. 1 shutdown including low interest loans and covering direct deposits.
In just three days, the shutdown resulted in 353 loan applications totaling $1,834,046 for furloughed federal employees at the $599 million Justice FCU in Chantilly, Va.
Justice said it was offering its members unsecured loans up to $10,000 at an annual rate of 0% for the first 60 days. The rate would convert to 4.90% after that time for a term of 24 months.
According to a release, the loan amount is based on the member’s net pay deposit, with direct deposit required. In addition, members can defer their first loan payment for up to 60 days.
The first three days of the shutdown, the credit union received 376 calls concerning furlough loans and 184 deferral requests, a Justice spokesperson told Credit Union Times.
Justice said it processed 41 new memberships online and eight new memberships over the phone during the same period.
The furlough loan applications for new members totaled $156,500 while the loans for existing members totaled $1,677,546, the 56,400-member credit union said.
“We have had branches closed due to their location within government-secured buildings but have alternative means of assisting members in need-call center, online loan applications, shared branch locations and over 138,000 surcharge-free ATMs,” the spokesperson said.
The $2.3 billion Service Credit Union in Portsmouth, N.H., automatically deposited military or DoD civilian government service pay into members’ accounts, based on their most recent direct deposit.
“Our 24/7 live person contact center has seen a dramatic increase in call volume from the shutdown since October 1,” said Lori Holmes, assistant vice president of marketing at Service CU.
Service has an estimated 10,000 members who are civilian defense workers, who were sent home along with other federal workers Oct. 1. About 3,500 have their payroll direct deposited to the credit union and qualify for the automatic deposit service. The remaining defense workers are being offered a $1,000, 4.9% APR loan, Holmes said.
The NCUA, which is not funded through congressional appropriations, was not impacted by the shutdown.