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Washington, D.C.-The head of the union representing employees of the Securities & Exchange Commission (SEC) today urged passage of the pay parity provisions a bill that would place employees of this key agency on a par with similar agencies with responsibilities for overseeing the nation's financial and banking systems.

In testimony submitted to the Senate Banking Committee, President Colleen M. Kelley of the National Treasury Employees Union (NTEU) said that "alarmingly high" turnover rates at the SEC make passage of the pay parity provisions of S. 143 "absolutely critical" to the nation. The bill, which has a bipartisan mix of 11 co-sponsors, was introduced by Sen. Phil Gramm (R-TX).

In the past two years, Kelley said, 25 percent of SEC attorneys, accountants and auditors have left the agency staffCincluding a turnover rate of 14 percent in 1999 alone. At comparable agencies, like the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve Board, the turnover rate is 5 percent, she said.

Among major agencies covered by the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), SEC employees do not follow a modified private sector model.

Most FIRREA agencies, like some others in government, do not receive appropriated funds. They operate on fees generated from the industries they regulate.

At the FDIC, where NTEU represents some 3,000 employees, the union "has been able to work with management to agree to compensation and benefit levels that attract a stable and professional workforce," Kelley said. Often, SEC employees work side-by-side with FDIC employees doing similar work at better pay. "Clearly, that is unfair," the NTEU leader said.

Not only is SEC losing professionals to other FIRREA agencies, she added, but it is "suffering a major exodus to the private sector," where securities lawyers who are only in the beginning stages of their careers can more than double their SEC salaries. "This excessive turnover robs the SEC and the nation," Kelley said, and forces managers to occupy their time in recruiting and training.

In addition to allowing SEC to offer market-based compensation and benefits, S. 143 would amend the Securities Exchange Act of 1934 to reduce securities fees. Its language mirrors that of a bill introduced last year.

NTEU is the largest independent federal sector union, representing some 150,000 employees in 25 agencies and departments, including 1,800 in both Washington headquarters and nationwide field offices of the SEC.