In response to a collection of Fair Labor Standards Act claims alleged by a group of mortgage loan officers, PNC Bank NA has agreed to offer a $16 million settlement. Plaintiffs in the wage suit claimed that the company denied them overtime wages and proper commission payments. 17 PNC BANK mortgage loan officers, some former and some currently employed, brought the collective action. The loan officers claim that PNC used an improper process for the calculation of commissions and that the company did not allow the employees to report overtime hours even though work in addition to what would be recognized as full time was required of them to fulfill their job duties.

According to the documentation, the settlement agreement will apply to mortgage loan officers employed by PNC in California from August 7th, 2011 through January 4th, 2017, New York from April 4th, 2011 through January 4th, 2017 and any other state from August 7th, 2012 through January 4th, 2017. PNC also noted that the settlement agreement is not an admission of liability or damages, but a move to avoid the burdens of further litigation.

Key Developments in the Case:

December: It was recommended that plaintiffs’ motion for class certification regarding commission recapture claims be granted.

Mid-November: Plaintiffs’ motion to strike PNC’s exemption defense was granted. The motion argued that former employees were exempt according to FLSA.

November: Conditional certification of the collective action was granted by Judge Schwab due to indications of uniform, nationwide employment policies in place at PNC.

The lawsuit alleged that during the hiring process, the company offered a salary of $24,000 per year based on a 40-hour workweek. Once hired, many of the officers worked more than 40 hours in a week and sometimes took work home with them in order to “catch up.” The “overtime” was allegedly not compensated. The workers allege that PNC offered bonuses to managers who refused, reduced or prevented workers from accurately reporting their overtime hours. In fact, it is alleged that the Branch Managers’ own pay was reduced in direct relation to the amount of overtime wages that was paid out to mortgage loan officers at the branch.

Plaintiffs also claimed that PNC did not accurately track and record the hours worked by mortgage loan officers, mortgage loan officers were not compensated for all the hours they worked, the company did not accurately calculate overtime (by NOT applying a “weighted average” including salaries, commissions, etc.), that PNC illegally deducted overtime pay from commissions, and that PNC was in violation of minimum wage requirements.

If you have questions about minimum wage requirements, or the calculation of overtime pay in compliance with California Labor Law, please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.