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By Chris Opfer
Sept. 22 — The Labor Department should investigate Wells Fargo for possible wage and hour violations, Sen. Elizabeth Warren (D-Mass.) and a group of Democratic lawmakers said Sept. 22.
The request comes two days after Senate Banking Committee members grilled Wells Fargo Chief Executive Officer John Stumpf over allegations that employees opened secret accounts for customers without their knowledge to meet sales quotas. Warren and the other lawmakers said in a letter to Labor Secretary Thomas Perez that they’re concerned the company violated the Fair Labor Standards Act by allegedly forcing employees to work off the clock.
“Any such investigation should include a comprehensive inquiry into whether Wells Fargo aggressively skirted overtime laws—failing to pay overtime to bank tellers and associates who stayed late or came in on weekends to meet their sales quotas, or misclassifying salaried bank associates as overtime-exempt to avoid paying the overtime guaranteed to them by the FLSA,” the senators wrote.
Wells Fargo agreed to pay $185 million to the Consumer Financial Protection Bureau and other authorities after a review found employees opened accounts and credit cards without customers’ permission. The CFPB said thousands of bank workers opened the accounts, which left some customers with overdraft and late fees, to meet aggressive sales goals.
The lawmakers said in the letter that the CFPB's investigation “uncovered a workplace characterized by stringent sales quotas and aggressive incentives imposed on its employees, and staggering neglect by management of the obvious consequences to consumers of those quotas and incentives.”
That includes forcing workers to log overtime hours without being paid, according to the lawmakers. The FLSA requires employers to pay covered workers a minimum wage for all hours on the job, as well as time-and-a-half pay for all hours beyond 40 each week.
A Wells Fargo affiliate in 2015 agreed to pay $2 million to settle claims that it wrongly classified certain account executives as exempt from the overtime pay requirement. A former Wells Fargo mortgage officer in Pennsylvania in August filed a lawsuit alleging the company forced employees to work off the clock without compensation.
“At Wells Fargo, our team members are our greatest asset,” spokeswoman Jennifer Dunn told Bloomberg BNA via e-mail Sept. 22. “We strive to make every one of them feel valued, rewarded and recognized and we pride ourselves on creating a positive environment for our team members, including market competitive compensation, career-development opportunities, a broad array of benefits, and a strong offering of work-life programs.”
Meanwhile, Warren and her colleagues noted that the DOL’s new overtime rule (RIN:1235-AA11) is slated to take effect in December. The rule is expected to make some 4 million workers newly eligible for overtime pay.
“It is critical that the Department investigate Wells Fargo now to ensure that the bank is not poised to skirt the forthcoming rule,” the lawmakers said.
DOL Spokesman Jason Surbey confirmed that the department received the letter. “While we cannot discuss details of potential law enforcement decision-making, we do take the concerns raised in the letter very seriously,” Surbey told Bloomberg BNA.
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