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DFS trending away from competitive titles when filling, creating positions


Since 2016, the number of non-competitive and exempt appointments at the Department of Financial Services has jumped, according to information in a DFS response to a Freedom of Information Law submitted by PEF.

“We’ve seen unprecedented numbers of exempt and non-competitive employment,” said DFS Division 260 Council Leader and Executive Board member Ade Oluwo. “It’s mind-boggling. We do not have any organizational charts despite repeated requests to have one.”

Oluwo said there has been a noticeable trend away from competitive hiring.

“We’ve seen the erosion of Civil Service titles,” he said. “We’ve seen so many positions that traditionally were tested now going into the non-competitive positions. We cannot see how that is benefitting the people that we serve. We are supposed to be a regulatory agency. How can someone honestly do the work they are supposed to do if they are working or if their appointment is at discretion of the appointing authority? If they don’t have any kind of protection?

“How can someone do a good job knowing full well that if you find something or you report something and your boss doesn’t like it, you can be fired at will,” he said. “These exempt and non-competitive positions have traditionally been in the competitive titles and the duties are similar.

Using waivers, DFS has been able to continue to fill positions with outside candidates despite a statewide hiring freeze during the COVID-19 pandemic. Those already working for the department and seeking promotion have been left in the cold.

“No employee in competitive titles has received any promotions despite the fact we have several promotional lists,” Oluwo said. “And some of those lists will be expiring soon. It’s a big issue. The department has nearly doubled in the last few years.”

Competitive titles have dropped and non-competitive have increased since 2013, according to data obtained by the FOIL request. In 2013, the department filled 165 competitive positions and 34 non-competitive and exempt titles. In 2019 the department filled 119 competitive positions and 82 non-competitive and exempt positions.

“I’ve never seen so many positions created,” Oluwo said. “Stress levels are at an all-time high. Everybody is working out of title and they are not filling positions. There is little opportunity for members to grow and advance and our members are completely stressed.”

The shift from competitive to exempt at DFS expanded when DFS received approval for title modernization under the guise of needing to adapt to a “fast-paced changing financial environment,” Oluwo said.

However, a fast-paced changing financial services Industry is nothing new to career civil servants, who have dealt with several global issues ranging from collateralized debt obligations, the sub-prime mortgage crisis, lending discrimination, natural disasters like Hurricane Sandy and upstate flooding, to name just a few.

“These professionals are the ones responsible for regulating over 1,500 insurance companies and 1,600 banking and other financial institutions,” Oluwo said. “They are the reason New York State is considered the financial capital of the world. These professionals are also responsible for bringing in billions of dollars in fines and penalties.

“DFS claimed that these positions would benefit employees and expand career opportunities. The truth is quite to the contrary,” Oluwo said. “Placement of positions in the non-competitive or exempt classes did not benefit the vast majority of DFS employees. It actually lengthens their career paths and does not bode well for the preservation of the civil service process of hiring.”

PEF opposes anything that erodes the Civil Service process.

“Appointments and promotions in Civil Service must be made according to merit and fitness and shall be competitive – to end the spoils system and to avoid corruption and fraud,” Oluwo said. “Non-competitive class appointments are only permissible when a competitive exam is not practicable. Exempt class placement must show inability to competitively or non-competitively test for the position.

“To date, the superintendent has appointed about 36 exempt positions, several non-competitive positions, and several non-statutory positions in less than one year despite not filling several open competitive positions throughout DFS,” Oluwo said.

PEF requested DFS organizational charts several times at the labor-management table, Oluwo said.

“As a matter of fact, it was made a permanent agenda item,” he added. “Furthermore, our PEF field rep made multiple FOIL requests and we’ve not received any information.”

Oluwo says he and his fellow civil servants have a passion for customers and efficient regulation.

“I have seen qualified, diligent, competent, and knowledgeable employees perform their tasks with the highest degree of professional standards,” Oluwo said. “DFS has failed to show through analysis and investigation why they are deviating from something that has worked very well over 160 years. Working in public service for most of us is not by accident but rather to make people’s day to day lives better and to make a difference in the society. We have already lost valuable positions, grades, and institutionalized knowledge through title modernization and we certainly do not want that trend to continue.”