Blocked from hazard pay grants, Pa. banks and credit unions push back
Pennsylvania credit unions and community banks have teamed up to express their concerns around being ineligible for hazard pay grants from the state.
Patrick Conway, president and CEO of CrossState Credit Union Association, and Kevin Shivers, president and CEO of the Pennsylvania Association of Community Bankers, voiced their “extreme disappointment” about the issue in a letter to Pennsylvania Gov. Tom Wolf. The $50 million program will be administered by the state's Department of Community and Economic Development. The grants will be made from the state's federal funding from the CARES Act.
Employers apply for the grants that will then be distributed to their workers.
“[T]o now deny our members and their employees hazard pay makes them feel like the risks they took to serve their customers and communities are not being recognized fairly,” Conway and Shivers wrote in their letter, dated July 29.
Banks and credit unions were deemed essential businesses and allowed to stay open as officials ordered other types of companies to shutdown earlier this year in an attempt to slow the spread of the coronavirus. Financial institutions limited foot traffic in their branches by closing their lobbies, only offering drive-thru services and seeing consumers by appointment.
Health care nonprofits, public transportation agencies and certified economic development organizations are some of the industries eligible to apply for hazard pay. The Pennsylvania Department of Community and Economic Development's website notes that not every industry that worked through the business shutdown is on the eligibility list. Per the department’s website, financial institutions, veterinary practices and pharmacies do not count as eligible industries to apply for hazard pay.
Conway and Shivers argued that front-line employees of community banks and CUs should be eligible since these individuals worked throughout shutdowns and stay-at-home orders. These employees provided essential services, such as handling transactions for deposits and payments and providing sensitive investment advice that could not be done remotely.
Employers can apply for up to $1,200 per employee, but employees must make $20 per hour or less to be eligible to receive the funds. The money may only be paid out over a 10-week period starting Aug. 16 and ending Oct. 24.
The financial services sector urged Wolf to reconsider the guidelines to include banks and credit unions.
“Front-line employees of community banks and credit unions should be included in the program guidelines as they were deemed necessary by the employer to report to work during the COVID-19 pandemic for life-sustaining eligible industries,” Conway and Shivers wrote.
Wolf’s office and the Pennsylvania Department of Community and Economic Development did not immediately respond to a request for comment.