Bank of America Corp. said Tuesday that it had agreed to pay as much as $9 million to settle a lawsuit brought by loan department workers in California who claimed they had been wrongly denied overtime pay.
The class-action suit, filed in federal court in San Francisco, claimed that the bank underpaid account executives, trainees and other workers selling mortgages and personal loans. California's wage-and-hour laws required the bank to pay overtime to the loan sellers, who were paid solely through commissions, said their attorney, Mark Thierman of Reno.
The class action is one of hundreds against companies in California seeking overtime and other pay for salaried and commissioned workers. More of these workers are eligible for overtime under state law than federal law, said attorney Margaret Hart Edwards.
"This makes it easier to file one of these cases and win it," said Edwards, who represents employers in such lawsuits and isn't involved in the Bank of America case. "Very, very few of these cases ever go to trial."
In August, Merrill Lynch & Co. settled a similar lawsuit brought by California brokers for as much as $37 million, of which about 25% was earmarked for overtime pay, and Allstate Corp. settled an overtime lawsuit brought by insurance adjusters for as much as $120 million.
Charlotte, N.C.-based Bank of America denied any wrongdoing or liability.
"Bank of America values its workforce and believes it has treated its associates appropriately and in full accordance with applicable laws and continues to do so," spokeswoman Shirley Norton said.
Bank of America shares fell 39 cents to $43.