M E M O R A N D U M

TO: FDIC Chapter Presidents

RE: 2005 Corporate Success Awards

SUMMARY: Pursuant to the terms of the Memorandum of Understanding (MOU) covering the FDIC’s Corporate Success Awards (CSA) Program, NTEU has filed a request for a joint review of the 2005 CSA data. NTEU has also filed a national grievance concerning the distribution of CSAs to employees in various demographic groups.

Under the terms of the FDIC-NTEU MOU, the FDIC recently provided NTEU with data concerning the distribution of CSAs for 2005. Based on our review of this data, NTEU identified several instances where the distribution of CSAs to certain demographic groups fell outside of normal or expected parameters, as identified in the MOU and the Uniform Guidelines established by the Equal Employment Opportunity Commission. These include:

· While 41.5% of employees below age 40 received CSAs, the rate for employees age 40 and above was only 30.1%.

· While over 35% of nonminority employees received CSAs, the rate for African-American employees was 27.5%.

· While over 35% of nonminority employees received CSAs, the rate for Hispanic employees was 27%.

· While 36.8% of DIRM employees in Grades 13–15 received CSAs, the rate for DIRM employees Grade 12 and below was only 16%. Also, while 40.7% of DIR employees in Grades 13–15 received CSAs, the rate for DIR employees Grade 12 and below was only 15.9%.

Since these results fall outside the parameters identified in the MOU and the Uniform Guidelines and are not within the normal or expected distribution pattern that would result from a random distribution of CSAs, these results trigger a joint review process under the terms of the MOU. During this joint review, the FDIC can attempt to justify the results by identifying a legitimate business reason for the distribution, or explain why these results are not statistically significant.

However, in anticipation of the fact that the FDIC will not be able to justify these results, NTEU has also filed a national grievance. This grievance alleges violations of law, the Compensation Agreement and the CSA MOU in the unfair and inequitable distribution of CSAs to employees age 40 and above, African-Americans, Hispanics, and DIRM and DIR employees below Grade 12. A copy of NTEU’s letter to the FDIC is attached.

In the meantime, NTEU is in the process of scheduling the arbitration hearing for the national grievance over the distribution of CSAs in 2004. If you have any questions or comments about these matters, please contact Steve Keller via e-mail at Steve.Keller@NTEU.org.

Colleen M. Kelley

National President

Click here for 2005 CSA Grievance Letter(pdf file)