Mortgage Loan Officers Win $9 Million in Unpaid Wages

In late September, 2011, a federal district court judge in New York ordered TopDot Mortgage to compensate 166 of its former mortgage loan officers for the company’s violations of minimum wage and overtime laws. The Order calls for TopDot–an arm of Premium Capital Funding–to pay these loan officers over $9 million in unpaid wages, plus attorneys’ fees and other costs which are still to be determined. The judgment against TopDot is one of the largest wage and hour judgments in 2011.

Almost three-fourths of the $9 million judgment against TopDot was based on the company’s failure to pay minimum wage; the remaining fourth was based on the company’s failure to pay overtime. The jury hearing the loan officers’ case found that TopDot had failed to pay a combined total of $4.5 million to its employees–and this figure was subsequently doubled since the Fair Labor Standards Act allows recovery of liquidated damages (which doubles the amount of unpaid wages).

The Fair Labor Standards Act (“FLSA”) requires that most employees (1) be paid at least the minimum wage for all hours worked and (2) receive one-and-one-half times their regular rate of pay for all hours worked in excess of forty in any work week. However, as described elsewhere on this blog, not all employees are covered by the FLSA; some are exempt from coverage. Though TopDot argued that its mortgage loan officers were not covered by the FLSA due to the administrative employees exemption, the United States Department of Labor and several federal courts have recently found that mortgage loan officers are covered by the FLSA. This court found similarly, and the jury went on to find that TopDot’s policy of compensating its loan officers based solely on commissions violated the FLSA’s minimum wage and overtime provisions. (As explained in their lawsuit, the loan officers’ primary job duty was to sell home loans by calling clients, collecting and inputting information into databases, and offering one or more of TopDot’s loan policies to clients.) TopDot’s compensation policies did nothing to ensure or provide a level of compensation greater or equal to what an employee working for minimum wage and working overtime hours would earn.

Apparently TopDot and the loan officers had been negotiating towards settlement until mid-2010. Companies often try to settle large lawsuits like this one rather than risk a substantial judgment against them. However, when settlements cannot be reached, as was the case here, employees are forced to go through the trial process in order to get the pay to which they are legally entitled. The same attorneys who helped these New York loan officers are also representing another group of TopDot loan officers in a similar suit in Florida.

If you have been deprived of minimum wage or overtime pay, or if you would just like to know more about your rights, you should contact a St. Louis overtime attorney.