As we reported last week, the National Treasury Employees Union (NTU) won an election to represent over 800 of the CFPB’s 1,200 employees.  The vote was 378 in favor and 86 against. 

I asked Shannon Farmer, a colleague who is a labor lawyer, whether this move would make it harder for the CFPB to fire incompetent employees and increase the agency’s human resource expenses.  She said that it would if the CFPB’s employees are not protected by civil service rules.  She also noted that it would make it more difficult for the CFPB to manage its employees.  Union arrangements often deter managers from being forthright with employees about their performance for fear of getting flak from the union.  Shannon thinks that this effect imposes the most significant costs on a company or agency whose employees unionize.  

As someone with no labor law background, I am struck by how 378 employees can obligate over 422 other employees to be part of a union shop. 

It is hard to say how this move might affect how the CFPB operates.  But many of those it supervises already have experience with NTU members, as the NTU represents employees of the IRS, SEC, FDIC and OCC.