CUNA supports NCUA’s proposed rule on involuntary liquidation and claims procedures, it wrote to the agency Tuesday. The proposed rule would be applicable to employees of insolvent credit unions under involuntary liquidation.
Specifically, it would permit an employee’s final paycheck to include compensation for the pay period immediately preceding the liquidation, as well as accrued but unpaid sick and vacation leave, including any severance to which the employee was entitled, provided such terms were documented and objectively applied.
“CUNA believes the amendment would improve the current procedure, under which wages and severance claims are assigned second priority, subordinate among unsecured claims,” CUNA’s letter reads. “The proposed rule would ensure that employees of an insolvent credit union are treated fairly and compensated in accordance with their contractual employment agreements.”