The top U.S. derivatives regulator is used to battling Wall Street. Now it's gearing up for a potential fight with its own employees.
In February, the Commodity Futures Trading Commission (CFTC) contracted to spend as much as US$420,000 on outside labor lawyers after its workers joined a union, public documents show. The CFTC retained the attorneys in case labor negotiations break down and the agency becomes embroiled in a legal dispute, said a person briefed on management's thinking who requested anonymity.
Tensions within the CFTC reached a flashpoint in December when employees grilled Chairman Timothy Massad about their compensation and benefits at an agency-wide meeting. The unrest comes at a pivotal time for the CFTC, which was transformed by the 2010 Dodd-Frank Act from a regulator of mainly agriculture futures to a front-line cop of the $700 trillion swaps market.
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Appointed and career employees at the agency say the additional responsibilities have overburdened the workforce, especially as the regulator's budget—now at $250 million—hasn't risen commensurately. Money has been so tight at the regulator in recent years that it was forced to request an emergency loan from the Treasury, furlough workers, and delay pay increases.
AFL-CIO Intern
CFTC management and the agency's new National Treasury Employees Union (NTEU) chapter are in the early stages of negotiating a collective-bargaining agreement, which typically governs work conditions. Massad, who began his career as an intern at the AFL-CIO labor federation before becoming a corporate lawyer, has pledged to work with the union.
"We look forward to having a good cooperative relationship with our union and are committed to working in good faith," Steve Adamske, a CFTC spokesman, said.
Low morale was an issue at the agency even before Massad became chairman last June. A recent federal survey found that just 40 percent of the CFTC staff are satisfied with their jobs and pay. The agency was ranked one of the worst places to work in government.
Workers said the decision to hire Shaw Bransford & Roth, a Washington firm that specializes in labor law, is a fresh sign that CFTC management is taking an aggressive response to negotiations. Another example is a move by management to try to exclude as many as 20 lawyers in the general counsel's office from joining the union, said the workers who asked not to be named because they are not authorized to speak publicly.
Colleen Kelley, president of the NTEU, said the union hadn't been notified of the decision to hire outside counsel.
"No matter who is representing the CFTC, we trust that the agency will collaborate with us in good faith to reach an agreement over employee issues," she said in a statement.
The contract calls for the CFTC to initially pay Shaw Bransford $196,000 if and when its help is needed. The deal could rise to as much as $420,000 over five years.
The regulator also has sought to hire in-house attorneys to help with labor relations, according to recent job postings.
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