By Ray Birch
BERRIEN SPRINGS, Mich.—There’s nothing wrong with nepotism in hiring, according to one CU. In fact, it insists a credit union is doing itself a disservice by having a “no-nepotism” policy.
Honor Credit Union here has not only ditched its no-nepotism policy; it has started “It’s Our Future,” a program that encourages employees to consider recommending their sons and daughters for full- or part-time positions when the fit is right.
CEO Scott McFarland believes credit unions that ban the hiring of family members are cutting off a valuable talent stream.
McFarland told CUToday.info that the children of CU employees often already have an understanding of the credit union philosophy and have a desire to be a part of the movement.
“I think it's hard for us to complain out of one side of our mouth that we can't get good, qualified people, and then out of the other side say good qualified people that might be coming from our own backyard can’t work for us,” he said. “It's silly to at least not consider these people. In a tight labor market, we are getting some skilled people we might not otherwise get.”
Valuable Viewpoints
The young staff also bring a needed viewpoint to the $935-million credit union, McFarland said.
“They bring new ideas to the table and share with us a very enlightening perspective,” he said. “It helps us interact with the younger generation of members.”
The program, which requires hires be at least 17 years old, began in 2016 and in the past year had 20 employees enrolled, most of them part-time, seasonal staff—including the CEO’s son—Mason—who worked in marketing and also as a teller.
“But we did not change our policy because my son wanted to work here,” explained McFarland. “What triggered the program was a daughter of one of our staff who was looking for work and had been turned away because of our no nepotism policy and I found out about that.”
A Lesson from League Meeting
That event took place several years ago when Honor Credit Union was in the middle of discussions about changing a policy that blocked hiring of staff’s family.
“Our VP of HR and VP of organizational design at that time attended the league meeting in this state. At the league’s awards breakfast they honored several people who grew up in credit unions. These people, who were being honored for their service, spoke about how they got their start at their mom’s credit union, saying their mother was the CEO, their father was on the board, their aunt was the CEO … These people who were being recognized for great accomplishments grew up in credit unions. Both of our VPs then said, ‘This is ridiculous that we don’t hire family members. All of these people are getting awards for coming up in credit unions and we are telling our families to stay away.’”
Scott McFarland
McFarland said the two executives returned from the meeting and immediately began working on the new hiring policy late in 2015, with the “It’s Our Future” program up and running by the start of the following year.
One Firm Rule
“One thing about this policy is we make it very clear–if we hire one of your family members they cannot report to you,” McFarland explained. “For example, if your son is reprimanded or asked to leave, you are out of that conversation. They are an adult, and it’s all about learning.”
The program does present some risk, McFarland acknowledged, because if things don’t work out well with the young hire, the parent’s attitude toward the credit union could change.
“If something goes wrong you can lose two people potentially. It's not all perfect, and we are very clear when the person starts they're coming here for work experience and that they do not report to their parent,” McFarland said. “It’s just like when your kids sign up to play on a sports team—your kids become the coach’s kid when they are playing.”
The program offers positions ranging from seasonal support, to co-op opportunities, to formal internships with local colleges. McFarland said if the employee works out and a full-time position opens up that interests the young staffer, they will be considered for the job.
“We fill a lot of gaps with the program,” explained McFarland. “We do pay the kids and we make sure they receive either college or high school credit for their work, if that applies.”
‘A Lot of Good’
The CEO emphasized a “lot of good” has come from the program, for both the CU and family of staff.
“Again, we get another pipeline of talented people who understand credit unions and they are getting the opportunity to work inside a credit union. Most of these hires are Millennials and they are getting their first experience working inside a financial institution. They get to see how a credit union works and how people benefit from being part of a cooperative.”
McFarland said his son is a perfect example of how the program shapes young lives.
“My son has not graduated yet, but he's definitely got the credit union bug, because he wants to work full-time in a credit union someday,” he said.