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First Republic Bank Sued in Class Action for Allegedly Misclassifying Employees

Once again it is important to stress the necessity of proper employee classification. Another company has recently been under investigation by the Wage and Hour Division of the U.S. Department of Labor. The investigation found that almost 400 employees of First Republic Bank in five states were misclassified as exempt from overtime when, in fact, they did not qualify for the exemption. The San Francisco-based bank also failed to properly track and record the employees’ hours, thereby violating the Federal Labor Standards Act’s (FLSA) recordkeeping requirements. In a settlement between First Republic Bank and the U.S. Department of Labor, the bank has agreed to pay more than $1 million in overtime wages.

Further, the employees were paid bonuses, which should have been factored when calculating their overtime. As this blog has recently discussed, although employees are normally paid one and one-half times their normal hourly rate for every hour of overtime they work, any performance-based discretionary bonuses need to be included when calculating the employee’s proper overtime rate.

Greg Berardi, a spokesman for First Republic Bank, said the bank has “addressed the issue and has fully compensated its employees. We regret the mistake.”

Labor Secretary Hilda Solis, in a statement, has stressed how important it is for employers to make sure they are abiding by all federal and state regulations. “It is essential that employers take the time to carefully assess the FLSA classification of their workforce. As this investigation demonstrates, improper classification results in improper wages and causes workers real economic harm.”

Generally, the FLSA provides overtime exemptions for executive, professional, and administrative employees, as well as outside sales representatives and certain computer employees. However, job title alone is not enough to qualify for overtime exemption. An employee’s job duties and salary must meet all of the FLSA’s requirements.

The attorneys at the Chicago Overtime Law Center are investigating unpaid overtime claims against large corporations such as Banks and other financial services companies for misclassifying employees as managers, failing to pay workers for overtime and other wages. If you are the victim this practice call us at (312) 869-4095 or contact us online.

The lawyers at the Chicago Overtime Law Center have decades of experience fighting for wage earner’s rights. We have a team of overtime attorneys who focus on nationwide class action lawsuits and work out of Chicago and Oak Brook offices and prosecute claims for workers all over the Chicago area including Lake Forest and Hinsdale. We protect unpaid workers who haven’t received overtime throughout the Chicago area including in DuPage, Kane and Cook Counties.

Our Highland Park and Deerfield overtime lawyers are intimately familiar with the issues that arise during wage claim litigation, and we know the laws that govern overtime cases well. Many employers misclassify employees as being exempt from overtime laws and pay workers salaries instead of hourly wages in order to avoid paying them overtime. Some employers mistakenly classify employees as exempt and others intentionally do so in order to circumvent the law. In either case, workers do not receive the wages they should, and a lawsuit may be the only way to recover their earned wages.

The Chicago Overtime Law Center is based in Chicago, and represents clients throughout the country who have not been paid for the overtime hours that they worked. If you believe that you are owed overtime wages, contact one of our Chicago wage and hour attorney by phone at (312) 869-4095 or through our online form.