The House Financial Services Oversight and Investigations Subcommittee last week subpoenaed two more employees of the Consumer Financial Protection Bureau (CFPB) who claim they were victims of – or were aware of – acts of discrimination and retaliation while working at the bureau.
CFPB examiner Ali Naraghi and former bureau employee Kevin Williams are set to testify during an upcoming hearing in connection with the subcommittee's ongoing investigation into alleged acts of discrimination at the bureau, the Washington Examiner reports. It will be the third such hearing since April.
In March, members of the oversight panel requested that the Office of the Inspector General launch an investigation into alleged discriminatory practices in the bureau. The investigation was requested in response to a complaint from CFPB attorney Angela Martin, who accused the agency of gender bias. In addition, an independent review conducted by Deloitte Consulting in fall 2013 found a pattern of higher performance marks for white employees compared with minorities.
As a result, the oversight panel requested officials from the CFPB and the employees union to testify at a hearing held April 2 – however, CFPB officials declined to attend that hearing. That resulted in the subcommittee voting to subpoena certain CFPB officials, some of who testified at the second hearing held May 21.
It's possible that additional testimony will likely be gathered at future hearings.
The Deloitte Consulting report, which was published in September, shows that white, male employees in the bureau were more likely to receive positive performance ratings than minorities, women and older employees.
The CFPB has since conducted its own internal review, which revealed ‘statistically significant differences in the performance ratings’ between black and Hispanic employees compared with non-Hispanic white employees.
What's more, according to the CFPB's 2013 Fiscal Performance Report, issued this month, performance reviews for employees over age 40 were ‘significantly different’ compared to those for employees under age 40, as were reviews for off-site employees compared to those working in the CFPB's main headquarters.
In the CFPB report, bureau officials claim that the disparities were not due to any single factor, but, rather, an overly sophisticated employee performance review system that allowed managers to create reviews using different criteria. Since January, bureau officials have been working with the National Treasury Employees Union to develop a new framework for the performance review program.
‘The performance management system implemented by the CFPB [in 2011] was based on best practices, and on paper, it had considerable merit,’ the CFPB states in the report. ‘However, in light of these findings, it is clear that the system was too sophisticated for a new agency like the CFPB, which was experiencing a high level of rapid growth and organizational pressures as it worked to build itself out starting from scratch.’
Part of the challenge, CFPB officials wrote, was that the bureau simply grew to fast – from 663 employees in 2012 to 1,302 in May 2014. This, combined with the fact that its performance review system was too complicated, resulted in some inconsistencies in how employee performance reports were created.
The CFPB announced earlier this month that it would remedy any past discrimination by making adjustments to the compensation of employees who may have been affected by past practices. Bureau officials estimate the extra pay will cost between $5 million and $5.5 million.
‘We are making appropriate adjustments to past compensation to ensure that we erase the remnants of any statistical disparities that were caused by our previous management system,’ the CFPB states in its 2013 Fiscal Performance Report.
The Deloitte report suggests that the bureau's Office of Minority and Women Inclusion (OMWI), which was put in place last year, is ineffective and that CFPB leaders and employees are not clear what the OMWI actually does.
‘Out of the 31 leadership interviews Deloitte conducted, approximately 80 percent expressed that they do not understand the purpose or objectives of the OMWI office,’ the report states.
