CCUA Testifies on Pending Regulations and Legislation on Behalf of Mass. CUs

The Cooperative Credit Union Association recently represented member credit unions in two public hearings on important pending regulations and legislation impacting credit unions' branch offices and credit reports in the workplace. A summary of the testimony and issues discussed follows:

Domestic Branch Office Fees:

The authority for the new fee regulations is rooted in the language within Chapter 338 of the Acts of 2020, the landmark legislation modernizing the Massachusetts credit union act. The public hearing yesterday was held jointly by the Executive Office of Administration and Finance and the Division of Banks and Loan Agencies relative to 801 C.M.R. 4.02:209 Division of Banks and Loan Agencies. The Association offered support as the amendments preserve the status quo of credit union domestic branch fees. No changes or increases in current credit union domestic branch fees provides transparency, predictability, and stability for facility planning as credit unions remain nimble to move ahead from the recent emergency status to serve members at preferred convenient branch locations.

Employee Credit Reports:

The Joint Committee on Labor and Workforce Development conducted a public hearing on three legislative proposals which add a new section to Chapter 93 to regulate the use of credit reports by credit unions as employers and prohibit persons from using credit reports for the purpose of employment screening or hiring decisions except when required by federal or state law. Similar to federal law, the bills provide that if a credit screening is required by federal or state law, then the employer must obtain the employee's or applicant's written consent each time the employer seeks to obtain the employee's or applicant's consumer report. They also provide that an employer who intends to make an adverse employment decision on the basis of the report must first disclose in writing the reasons for the decision and offer the employee or applicant an opportunity to dispute the accuracy and relevance of the information. Finally, the bills prohibit the employer from passing along the costs of obtaining the report to the employee or applicant; prohibit the employer from retaliating against complaints or requesting a waiver of the law; and provide that violations of the law are unfair practices under M.G.L. C. 93A, the state unfair and deceptive practices act, also referred to as the Massachusetts Consumer Protection Law. 

The Association outlined the rules and procedures used by credit unions to conduct credit checks in the employment setting and requested clarity and transparency in any final proposal released by the Committee through the addition of an express exemption to the prohibition on the use of credit reports in the hiring and employment context for credit unions as financial service providers. Testifying in opposition to the measure was the National Consumer Law Center, who noted that favorable consideration would help end the financial death spiral following the pandemic as employees reenter the workforce and also assist with the disparity in the racial wealth gap.


Written testimony on branch fees may be found HERE and on credit reports may be found HERE.