A federal judge ordered Wells Fargo to pay its California home mortgage consultants and private mortgage bankers a total of $97 million for a violation of labor laws.
A federal judge in Los Angeles ruled on Tuesday that bankers and consultants are entitled to pay not just based on their hourly rate but also their commissions, according to an article by Edvard Pettersson for Bloomberg. This ruling moved the damages up from the $25 million it said it owed its employees.
From the article:
The lawsuit alleging various California wage and hour labor violations was brought last year by a Wells Fargo mortgage broker in Los Angeles. U.S. District Judge Percy Anderson threw out her claims other than the bank’s failure to provide rest breaks and one on unfair competition.
But Wells Fargo disagreed with the ruling, saying its plans to appeal.
“Wells Fargo’s compensation structure for its home mortgage consultants complies with California’s wage and hour laws, including pay for all break periods, and allows our HMCs to earn competitive, performance-based compensation,” a Wells Fargo spokesman said. “We plan to appeal on the basis that the court’s decision reflects both a misunderstanding of our HMC compensation plan and a misapplication of the relevant state law.”
This is just the latest in a string of judgments against the bank. Most recently, the bank agreed to pay $480 million to shareholders to settle a fake accounts suit.
That settlement stems from actions originally taken in 2016 by the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, and the city and county of Los Angeles to fine the bank $150 million for more than 5,000 of the bank’s former employees opening as many as 2 million fake accounts in order to get sales bonuses.
And in April, the CFPB and the OCC announced a $1 billion fine for the bank, demanding that it reimburse affected borrowers.