On January 12, 2011, the Mortgage Bankers Association ("MBA") filed a lawsuit against the U.S. Department of Labor ("DOL") challenging the DOL's Wage and Hour Division Administrator's Interpretation No. 2010-1 regarding mortgage lenders non-exempt overtime status under the Fair Labor Standards Act.
We previously reported in March of 2010 that the DOL issued an Administrator's Interpretation reversing its prior guidance and concluding that a "typical" mortgage loan officer does not qualify for the administrative overtime exemption under the Fair Labor Standards Act. The Administrator's Interpretation was a significant reversal in the DOL's long-standing position that mortgage lenders were exempt from overtime requirements. That article is found here. Based on Administrator's Interpretation, many employers in the financial industry have changed their pay practices for mortgage lenders.
The MBA alleges that in issuing the March 24, 2010 Administrator's Interpretation, the DOL substantively changed its own interpretation of its administrative regulations. The MBA alleges that the DOL could not legally effect such a substantive change without affording a proper notice and comment period, and public hearings on the issue allowing interested parties to weigh in on the proposed change. The MBA seeks to have the Administrative Interpretation vacated and to enjoin the DOL from enforcing or applying the Administrative Interpretation.
Boardman will follow the MBA lawsuit and will keep you updated with key developments. If you have any questions about this, please contact Jennifer Mirus of the Boardman Banking Group at jmirus@boardmanlawfirm.com or (608) 283-1799.
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