$6.5M U.S. Bank Class Action Settlement to Benefit Bank Employees

A federal judge has granted final approval to a $6.5 million settlement between U.S. Bank and hundreds of employees participating in labor and wage class action lawsuits.

The settlement puts to rest three cases involving mortgage loan originators who worked for U.S. Bank in California. In those lawsuits, employees claimed U.S. Bank violated California labor laws by failing to pay minimum wage, failing to pay overtime wages, failure to pay earned commissions, and failure to provide meal and work breaks.

Mortgage officers also claimed U.S. Bank failed to pay them in a timely manner for wages owed when they stopped working for the company.

Details of the U.S. Bank Class Action Settlement

Under the terms of the U.S. Bank class action settlement approved by U.S. District Judge Janis L. Sammartino on Aug. 20, some $4 million of the total payout will be divided among the 840 participating Class Members of each class actions lawsuit. Those who worked as mortgage loan originators in California between July 2014 and April 2020 are eligible.

On average, each Class Member will receive about $4,800, though some may get as much as $15,000. The original lead plaintiffs will receive an additional $25,000. The second and third to take action will receive an additional $15,000.

U.S. Bank will also pay $325,000 in penalties to the state of California for its labor and wage violations.

Both sides agreed the U.S. Bank class action settlement award would include about $2.15 million in attorneys’ fees and $30,000 in expenses, plus $14,500 set aside to cover the cost of the class action administrator. The administrator is tasked with managing the payout and distributing it to the participating Class Members.

Aside from the monetary settlement, U.S. Bank has also agreed to change its labor policies. In the future, the company’s mortgage loan officers will be provided breaks and compensated for meetings and training, according to the settlement.

The U.S. Bank class action settlement was unanimously approved by the Class Members, only one of whom opted out of participating in the final agreement.

Wage and Labor Practices Led to Class Action Lawsuits

The first of the class action lawsuits against U.S. Bank covered by the settlement was filed by a mortgage loan originator in July 2018. Just more than six months later, two other mortgage originators filed their own class action lawsuits against the bank.

All three made the same basic allegations – the bank had violated California wage and labor laws in calculating their pay, deprived them of work breaks, shortchanged them in overtime pay, and held up commission payments they were owed when they left the company.

Mortgage loan originators sell their lenders’ home loans to prospective homebuyers and then shepherd their customers through the process to the mortgage closing process, according to Forbes.

The plaintiffs claimed they were paid less than minimum wage for the hours they spent doing non-sales work and U.S. Bank “improperly averaged” their commissions.

California law requires employers to pay at least minimum wage and to pay one and one-half times their regular rate of pay for anything more than eight hours worked in a day and 40 hours in a workweek, unless the employees are exempt.

The law also says employees are entitled to a “30-minute off-duty lunch break if they work more than 5 hours in a workday, and 10-minute breaks every 4 hours worked.”

The U.S. Bank Class Action Lawsuit is Case No. 19-cv-286 in the U.S. District Court for the Southern District of California.

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