Layoffs at PenFed could impact hundreds of employees

Headquarters of the Pentagon Federal Credit Union. (Source: AdobeStock)

On the morning of November 1, the Pentagon Federal Credit Union, based in McLean, Va., held a series of video calls on Microsoft Teams to inform potentially hundreds of employees that they no longer had work at the cooperative. credit.

According to several sources contacted by CU time, the number of employees laid off by the 35.8 billion PenFed ranges from 200 to 600 people spread across many states across the country. The layoffs appeared to be focused on remote employees who worked in the credit union’s loan departments.

Since learning of the layoffs earlier this month, CU time was able to confirm through sources and documents that the dismissals took place not only on November 1, but also in September.

CU time contacted PenFed on Wednesday to provide details of the layoffs, but received no response.

A current PenFed employee said, “It was flagged as a labor adjustment due to market conditions due to lower lending volume…they’ve been very quiet about it and will not say the total number or departments.”

On November 2, when CU time Learning of the layoffs for the first time, we reached out to PenFed for comment and received a statement from PenFed Vice President of Corporate Communications, Kassandra Sebastia. It read, “PenFed makes business decisions to better serve and bring value to our members. This includes making strategic changes due to the economic climate and market developments. We support affected employees through their transition and treat them with respect and care. »

PenFed has not confirmed the number of laid off employees, their positions or their locations. Although PenFed has not publicly provided such details, two credit unions have proactively shared layoff notices with the public in recent months.

In September, the $10.6 billion GreenState Credit Union at North Liberty, Iowa announced that it had laid off 42 employees due to “market corrections and rising interest rates”. Most of the workforce reductions have been in GreenState’s mortgage or commercial banking operations.

In October, the $1.5 billion Collins Credit Union in Cedar Rapids, Iowa announced that it has laid off 38 employees due to lower consumer demand for mortgages and refinancing.

According to documentation and interviews, PenFed layoffs occurred in at least seven states. These states included California, Nebraska, North Carolina, Florida, Arizona, Texas, and Idaho. CU time searched each state’s database for official documentation of layoffs.

No layoffs by PenFed have been reported in any of the listed states, and this may be due to a reporting law that has not been enacted consistently across all states.

The Worker Adjustment and Retraining Notification (WARN) Act requires employers with 100 or more full-time employees to provide written notice at least 60 calendar days before a job site closes to their employees and to employment agencies across the country. Status when it affects 50 or more employees. , or a mass layoff affecting at least 50 employees and one-third of the total jobsite workforce or 500 or more employees at the job site alone during a 90-day period, according to the U.S. Department of Labor.

State agencies post these written notices on their websites.

While many states follow the requirements of the federal WARN law, some states have enacted layoff notice laws that differ somewhat from federal laws, according to the Lunt Group, a company based in Sandy, Utah. , which publishes information regarding federal and state employment laws.

It should be noted that not all dislocations require 60 days notice.

According to the Department of Labor, the WARN Act provides certain exceptions to the requirements where employers can prove that layoffs or job site closures are occurring due to business failures, unforeseen business circumstances and natural disasters. In such cases, the WARN Act requires employers to give their employees as much notice as possible.

CU time not sure why no WARN notices have been posted as of the date of this posting. One reason appears to be that fewer than 50 PenFed employees have been laid off in each of the seven states listed.

CU time contacted some employees who were laid off on November 1 – all of whom wished to remain anonymous for fear of losing their severance pay.

One employee said PenFed ‘changed my life for the better’, but how they were treated in the end ‘didn’t make sense’ because they were ‘making a lot of money for the credit union’ and had only received 30 days allowance.

In a message to CU timea former employee said, “The right thing to do would be to give us an extra month (60 days in total) to get us into this new year given the timing, the industry climate and the holiday season .

Over the past two weeks, former employees have been posting information about the layoffs on Indeed.com, LinkedIn and private Facebook groups.

The messages included statements such as “I will miss this job”. Others said, “Families don’t have layoffs. Protect PenFed Jobs!

According to documentation CU time read, many employees who have been terminated are “eligible to apply for positions within PenFed.”