LOs Challenging OT Appeals Decision

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1 · 05 · 13

Three Quicken Loan Inc. originators are challenging a recent appellate court decision on overtime pay in favor of mortgage employers.

A Department of Labor opinion letter issued to the Mortgage Bankers Association in 2006 interpreted the department’s own regulations and concluded typical loan officers were exempt from Fair Labor Standards Act requirements for overtime payments under the “administrative exemption.”

But in March 2010, the Labor Department’s Wage and Hour Division Administrator issued Interpretation No. 2010-1 — reversing and withdrawing the 2006 opinion letter.

The trade group filed a lawsuit against the department in January 2011, and the case was dismissed in June 2010 by a federal judge in Washington, D.C.

MBA appealed the decision to the U.S. Court of Appeals for the District of Columbia Circuit, which ruled in July that the Department of Labor would be required to complete the rulemaking process if it wanted to reverse the 2006 letter.

But while the decision was a victory for mortgage employers, it was too much for three Quicken loan officers.

The trio petitioned the appeals court for en banc reconsideration of the ruling, according to a client letter from Ballard Spahr LLP.

Federal appellate courts sometime grant a rehearing en banc so that the judges, themselves, can reconsider the decision of a court-appointed panel.

“The petition urges critical re-examination of the decision, asserting that it is at odds with the majority of federal appellate courts that have examined a federal agency’s authority to issue interpretations of its regulations,” the newsletter from the Washington, D.C.-based firm stated. “The petition further asserts that the decision has implications reaching far beyond the DOL and its interpretation of FLSA regulations, potentially affecting all federal agencies subject to APA rulemaking procedures.”

The Labor Department is reportedly preparing its own en banc petition for rehearing.


Mortgage Daily Staff


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