Settlement Proposed for Wells Fargo Advisors Class Action Lawsuit

Wells Fargo is poised to pay $9.5 million to settle a California wage and hour class action. The Wells Fargo advisors class action lawsuit claims the bank did not reimburse business expenses or pay commissions in a timely fashion.

On April 26, plaintiffs in a Wells Fargo advisors class action lawsuit asked a California federal court to preliminarily approve a $9.5 million settlement. The Class of current and former financial advisors numbers over 2,000 and comprises employees who worked at Wells Fargo from March 2010 through January 2018.

The net settlement fund is expected to be $6,163,334 and will cover 130,000 work months across the settlements. Under the preliminary settlement, each Class Member would receive $2,783 after fees and costs associated with the Wells Fargo advisors class action lawsuit. This amount equated to about $47 per month worked, according to the settlement proposal.

The Wells Fargo advisors class action lawsuit claims that the bank did not properly reimburse their financial advisors for business expenses and failed to pay commissions on time.

According to the plaintiffs, Wells Fargo issues paychecks once every two weeks, with the second paycheck of the month including the commission earned in the previous month. The Wells Fargo advisors class action lawsuit claims that this timeline is too long and unfair. However, Wells Fargo holds that their administrative policies are lawful and reasonable.

“Wells Fargo contends that this timing is lawful, because the wages are paid in the pay period following that in which they are earning and that it would be administratively impractical to pay the amounts sooner,” the proposed settlement motion states. “Wells Fargo further contends that financial advisors have the option to receive payments in advance of this pay schedule based on estimates, and relatively few financial advisors select this option.”

The group of financial advisors who make up the Class filed the suit in 2014. The original suit also made claims that they should have been classified as hourly workers and sought a nationwide class certification under the Fair Labor Standards Act.

In February 2016, a California federal judge dismissed the plaintiffs’ original claim that Wells Fargo had violated the FLSA by classifying them exempt from overtime. The judge ruled that the plaintiffs’ testimony established that they were exempt.

However, this ruling did not dismiss the other claims in the Wells Fargo advisors class action lawsuit. These claims were further negotiated after the plaintiffs’ final attempt to appeal the dismissal of their FLSA claims.

The Wells Fargo Advisors Class Action Lawsuit is Case No. 3:14-cv-02552, in the United States District Court for the Northern District of California.

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