WASHINGTON (Reuters) - The head of the U.S. consumer watchdog told lawmakers on Wednesday that new managers at the agency initially did not get enough training about creating a fair workplace for women and minority employees, an “oversight” he said the bureau is now addressing.
The U.S. Consumer Financial Protection Bureau in May said it was throwing out its system of rating employees’ performance after revelations that employees over the age of 40, racial minorities and other groups received lower rankings and lower bonuses than did their colleagues.
Some employees of the bureau, which opened in 2011, have since told the House of Representatives Financial Services Committee that they experienced hostile work environments and faced retaliation when they reported problems.
Bureau Director Richard Cordray said the problems likely stemmed from the bureau’s unsettled culture as managers scrambled to hire employees and write rules required by the 2010 Dodd-Frank law. He said managers now receive “considerably more” training about workplace issues.
“What I’ve come to see frankly is I don’t think we did enough of that in the beginning,” Cordray told the financial services panel’s oversight subcommittee.
“It was frankly probably an oversight of the bureau and just kind of reflective of the start-up phase, perhaps, but it hurt us, I think, a great deal in various respects,” he said.
Dodd-Frank created the bureau and charged it with overseeing consumer financial products such as mortgages and credit cards after the 2007-2009 crisis.
The watchdog has faced opposition since it opened in 2011. Congressional Republicans sought, without success, to curtail its broad authority over consumer financial products and replace its director with a bipartisan board.
Cordray said in May that an internal analysis had found that black and Hispanic employees received lower performance ratings in 2012 and 2013 than their white colleagues did.
Employees who worked in field offices instead of the Washington headquarters or who had less than a year of experience also received lower scores on average.
The bureau said it would re-do its performance management system and compensate employees who received lower ratings as if they had received top marks.
Cordray also ordered the bureau’s Office of Minority and Women Inclusion to report directly to him and assigned its director, Stuart Ishimaru, to gather information from employees about the bureau’s culture.
Representative Patrick McHenry, a North Carolina Republican who chairs the oversight subcommittee, said that was not sufficient and that bad managers should be fired.
“I‘m not interested in hearing about bureaucratic ways the bureau is papering over the real problem. We need action. We need results,” McHenry said.
McHenry also said he and fellow Republicans Jeb Hensarling, who leads the Financial Services Committee, and Shelley Moore Capito had asked the Government Accountability Office to study the organizational culture and personnel management at the CFPB.
Reporting by Emily Stephenson; Editing by Steve Orlofsky