How the Union Won the Student Loan Repayment Program...and How We Continue to Defend It


History of the Student Loan Repayment Program at the SEC

The road to the Student Loan Repayment Program (SLRP) began back in the 1990s, when NTEU’s national Legislative Department won legislation in Congress affording the Office of Personnel Management (OPM) a wide range of recruitment and retention flexibilities that they could offer federal agencies, including student loan forgiveness. Subsequently, NTEU's Legislative Department worked closely with OPM to ensure the issuance of regulations giving this discretionary authority to federal agencies.

The SEC, however, did not opt to create a student loan forgiveness program until NTEU commenced its representation of SEC employees. Shortly after employees voted NTEU to serve as their exclusive representative at the SEC, the union negotiated the current program at the agency in its first Collective Bargaining Agreement back in 2002. The basic program may be found in Article 25 of the Collective Bargaining Agreement.

We are proud that the SLRP negotiated by NTEU at the SEC is one of the very best in the federal government. It provides up to $10K per year in reimbursements, up to a total of $60K lifetime, in exchange for a three-year commitment to stay at the SEC. Under the program, the SEC provided benefits to several hundred employees in 2019 alone.

With about 4,500 employees, the SEC accounts for about 1/500th of the federal workforce but it provides about 9% of all of the SLRP benefits made in the federal sector. This impressive ratio results from the fact that, unlike many other federal agencies where only a fraction of the employees who seek a student loan repayment are given one because they are not deemed critical to retain, the SEC typically makes these payments on behalf of virtually all employees who seek them – based on the union’s contention that the SEC has hired a highly specialized and uniquely qualified workforce that it must hold on to in order to advance its mission.

This type of program is a win-win for everyone involved. Employees get their student loans repaid early, enabling them to pursue a career in public service. And the SEC is afforded a powerful recruitment and retention tool to ensure that it continues to attract and retain the best and the brightest.

The Union’s Successful Efforts to Defend Against the SEC's Repeated Attempts to Make Cuts to the SLRP

But our work did not end with the inclusion of the SLRP in the CBA. In fact, over the years, SEC management has attempted on numerous occasions to weaken the program. Fortunately, the union was able to defeat each of these efforts, which included:

  • An attempt to recover more than three years of reimbursements when an employee leaves the agency before completing his or her three-year commitment. After the union filed a national grievance pointing out that this change violated OPM's regulations, the agency agreed that it may only reach back to collect the last three years of reimbursements if for some reason an employee leaves the SEC early.
  • A refusal to make further distributions to employees when their loan balances dropped below $10,000, even if the employee had not yet received the $60K lifetime cap. After the union filed a national grievance, the SEC stopped taking this illegal position.
  • An attempt to force employees to make monthly payments on their loans, even when the annual disbursement they receive under the program means that they are not obligated to make such payments for some period of time under their individual loan agreements. After the union filed a national grievance, the SEC stopped imposing this rule.
  • A refusal to reimburse federal PLUS loans, which are loans that parents borrow to help defray the costs of their children’s education. PLUS loans are expressly provided in the enabling legislation and regulations thereunder for student loan repayment programs. Retention bonuses are just as important for employees taking out PLUS loans as they are for recently graduated employees paying off their own loans. After the union obtained a judgment from a federal arbitrator that the SEC was violating the Age Discrimination in Employment Act through this unilateral action, the agency signed a settlement with NTEU agreeing to continue to reimburse PLUS loans and also to make retroactive payments to affected employees.

SEC management also sought a number of givebacks related to the SLRP in Collective Bargaining Agreement Negotiations by:

  • Proposing a new provision stating that all decisions on participation in the program would be totally at the discretion of management, similar to its current total discretion over whether or not to award year end Special Act Awards. This provision would have greatly expanded management’s ability to deny as many applications as it wants without reference to any principled standard.
  • Proposing to remove the provision permitting an employee to nominate him or herself for participation in the SLRP, which would have left it solely up to management to nominate employees. Obviously, this would have allowed managers to block participation of anyone simply by refusing to nominate them, without reference to any standard for such refusal.
  • Seeking to insert the word “minimally” before “eligible” in the following sentence – “To be eligible for participation in the SLRP, an employee must have completed one year of service with the Employer, maintained an acceptable level of performance, and meet the eligibility requirements outlined in 5 C.F.R. §537.104.” By attempting to change this provision to read “minimally eligible,” management was seeking to make it clear that it could deny the applications of fully eligible employees – something that it has not done in the past.
  • Attempting to delete the phrase “one or more of the following” from the provision that lists the types of contributions that would warrant participation in the program. This change would have meant that employees must have made all of the types of contributions in the preceding year that are listed in the article – a standard that very few employees could possibly meet.

Taken together, these proposed changes would have greatly expanded the SEC's authority to deny participation in the SLRP without reference to standards and without transparency or fairness. Fortunately, after months of refusing to accept these new management proposals, the NTEU CBA negotiating team was successful in forcing management to remove them from the table altogether. So these changes never became part of the current CBA. Moreover, in 2014, the union convinced management to amend the CBA to permit employees in their first year of employment with the agency to apply for the program. And in 2018, the union got management to agree to administer this program under the authority it has under a provision in The Investor and Capital Markets Fee Relief Act of 2002, a measure NTEU pushed through Congress, to create its own pay and benefits system. This move frees the SEC from the $10k per year and $60k lifetime benefit restrictions and opens the door to increasing these limits in the future.

The SLRP is an excellent example of how your union is able to improve the lives of SEC employees -- through legislation, negotiation and, when necessary, the arbitration process. Thank you to all of the dues paying members of the union -- both for making the SLRP a reality and for making it possible for the Union to continue to defend this important benefit.