The financial services industry has been the target of multiple class and collective action lawsuits over the last decade by plaintiffs contending that loan officers, financial consultants and other employees were improperly denied overtime pay. In 2005, the industry convinced the Department of Labor to include certain of these employees in its examples of exempt administrative employees. These examples describe financial services employees as exempt only where their primary job duties involve analysis of and advice regarding financial products, and not just selling the products.
Last week in Henry v. Quicken Loans, Inc., the Sixth Circuit Court of Appeals affirmed a lower court decision determining that the defendant's mortgage brokers fell within the administrative exemption. The plaintiffs claimed that they were little more than glorified salespersons, and that they had little discretion and independent judgment when it came to selecting mortgage products for prospective customers. The employer provided testimony of 40 current and former mortgage bankers to demonstrate that the job required more than just selling. These employees testified that their primary job duties involved analysis of customer needs and selection of mortgage products that meet those needs.
The Sixth Circuit concluded that the jury had adequate factual grounds to support its conclusion that the plaintiffs were exempt administrative employees. The fact that the bankers were supervised in terms of their work and product selection did not remove the element of discretion and independent judgment. In many of these cases, the eventual exempt/non-exempt determination depends on a detailed factual analysis of the employees' specific job duties. Employers seeking to claim the administrative exemption should develop job descriptions and work structures that will support the factors necessary to claim this exemption.