PNC Bank has agreed to pay $12 million to settle a class action lawsuit by its mortgage loan officers arising from a series of alleged labor violations. Among these, the bank was accused of failing to account for loan officers’ breaks for their compensation, and that it improperly took deductions from their salary, causing them to make less than they were legally entitled to. While PNC argued that its compensation scheme was fair, it ultimately settled after losing on a partial motion for summary judgment.
What is This Lawsuit About?
PNC Bank was accused of a number of serious labor violations by its mortgage loan officers (MLOs) in a class action suit. Most notably, they were accused of using an “incentive compensation” scheme that was intended to encourage MLOs to sell more loans by tying their compensation to the amount of loans they sold. In theory, MLOs were still paid a base salary, even if their sales failed to meet their goals, but through the compensation scheme, workers could lose that base salary via deductions, meaning they would only get paid commissions.
What Did They Allegedly Do?
PNC Bank’s compensation scheme violated labor laws in two critical ways. First, it failed to compensate MLOs for time taken on legally mandated breaks, which is required by California state law where the employees live. Second, it resulted in illegal deductions to the employees’ salary, causing it to be recaptured to compensate the company for supposed losses from failing to sell sufficient loans. Thus, many of them only made money from commissions, and even then their commissions were sometimes deducted to make up for supposed deficits.
What Will This Settlement Do?
First and foremost, PNC will be forced to pay $12 million to the MLOs who lost income as a result of their compensation scheme. This includes payment for unpaid rest periods, lost wages, interest, penalties, and attorneys’ fees and other legal costs. PNC, meanwhile, was allowed to deny all wrongdoing, and does not admit that any aspect of its “incentive compensation” scheme was illegal.
What Should You Do if This Happens to You?
If you are working for an employer and have been illegally denied compensation for the work you put in, you should speak to a lawyer with experience handling employment law issues. They can help you review your situation and help you to make the best decisions possible for your case. The sooner you call, the sooner they can get to work on your behalf.
Steven Mitchell Sack, the Employee’s Lawyer, is a New York employment lawyer with more than 44 years’ experience handling the many aspects of employment law. His new book, “Fired!: Protect Your Rights & FIGHT BACK If You’re Terminated, Laid Off, Downsized, Restructured, Forced to Resign or Quit,” is available in hardback, and contains valuable advice on dealing with employment and labor law issues. To purchase the book, feel free to contact Steven Sack at 917-371-8000 or visit the website at legalstratpub.com. To inquire about a legal matter, please feel free to contact attorney Steven Sack at 917-371-8000 or stevensackatty@hotmail.com.
