Today, tomorrow, and well into the future, collector compensation will be tied to compliance and complaints, according to a panel of collection industry professionals who spoke during a webinar hosted by AccountsRecovery.net earlier today.
The webinar, sponsored by Cornerstone Support, aimed to share best practices in collector compensation, at a time when more agencies are looking at replacing commission-based models with more straightforward hourly or salary payment plans. But while that day of change is still well off on the horizon, recent events may be pushing more agencies toward that new model.
A consent order between the Consumer Financial Protection Bureau and Wells Fargo, in which the mega-bank agreed to pay more than $180 million in fines and penalties after it was revealed that employees were opening fake accounts in customers’ names to achieve sales goals has shone a spotlight on compensation plans that rely on commissions. Many collection agencies use commissions as an incentive for collectors to try and recover as much money as possible. But in a time when compliance has never mattered more, many agencies are incorporating compliance components into their compensation plans.
“How is compliance part of a compensation package,” asked Rick Perr, a partner in the law firm of Fineman, Krekstein & Harris, and a panelist on the webinar. “Compliance has to be a component of compensation.”
Along with incorporating compliance, performance, and many other areas of the business, collector compensation also must reflect the composition of the workforce, said Alicia McKeighan, the chief compliance officer at Afni, Inc.
“You have to look at your workforce and if they are mostly millennials, you have to ask them what they expect in terms of a compensation model,” McKeighan said during the webinar. “Is a salary more beneficial to them? You have to make sure you are serving your workforce with your compensation model.”
One of the areas of compensation that appeals to employees of all generations is peer recognition. And that remains an important component of an effective compensation — and employee retention — plan. On its intranet site, for example, any employee of Enhanced Resource Centers can nominate or give “kudos” to another employee for a job well done, said Jason Davis, the senior vice president of compliance. The company also has awards and employees can win t-shirts and get their names and pictures on posters in the office.
“We want it to be very visible,” Davis said.
You can download a copy of the webinar recording by clicking here.
