Transparent pay policies
Credit unions might not get lumped with the “Wall Street fat cats” blamed for many of the current economic woes, but that doesn’t mean they can afford arbitrary pay policies.
“Your compensation plan has to be internally equitable and defensible and externally competitive, and must accurately reflect your credit union’s compensation philosophy,” says Soltis. “It also must be legally compliant.”
As credit unions make plans for strengthening their operations coming out of the recession, University Credit Union’s simple mantra might help: “Be better,” says Sinibaldi. “It’s tough out there. If we can look at each thing we do, and give ourselves a continuous challenge of trying to improve, we’ll get through this.”
THE TRUE COST OF COMPENSATION
No report on salaries and expenses is complete without a look at their impact on your bottom line.
Operating expenses among credit unions with $1 million or more in assets averaged about $3.9 million in 2009, according to CUNA’s 2010-2011 Complete Credit Union Staff Salary Survey Report. On average, salary expenses account for 41% of these credit unions’ total operating expenses. Benefits expenses account for 9.6% of operating expenses.
Looking solely at salary expenses, credit unions spent an average of $1.3 million in 2009. And credit unions overall averaged $374,291 in benefits expenses in 2009—about $11,000 per full-time employee.
Overall, when expressed as a ratio of gross income, salary and benefits expenses equal 43.2% and 9.8% of gross income, respectively.
About 55% of credit unions with $1 million or more in assets have sponsors, but few say their sponsors pay for any portion of the credit union’s salary or benefits expenses. Only 1% of credit unions say their sponsors pay any portion of the credit union’s salary expenses, and 2% say their sponsors pay any portion of the credit union’s benefits expenses.
For more information on the report and CUNA’s suite of supplemental salary survey resources, visit cuna.org, and select “products & services” and “reports & surveys.”
• CUNA, buy.cuna.org:
1. 2010-2011 Complete Credit Union Staff Salary Survey Report: select “products & services” and “reports & surveys.”
2. 2010-2011 Credit Union Environmental Scan: select “products & services” and “2010-2011 E-Scan Report.”