Department of Labor Reverses Course on Mortgage Loan Officers
On March 24, 2010, the Department of Labor abruptly reversed its position on the exempt status of mortgage loan officers for purposes of eligibility for overtime compensation. Less than four years ago, the Department of Labor issued an Opinion Letter in which it determined that mortgage loan officers were exempt “administrative” employees and thus ineligible for overtime. In its new ruling, the Department of Labor concludes that mortgage loan officers are primarily responsible for the sale of mortgage loans, and therefore they are “production” workers and do not qualify for the administrative exemption.
The Department of Labor's newly revised position with respect to the exempt status of mortgage loan officers is a very significant development for employers who must now face the task of reclassifying their mortgage loan officers as non-exempt employees and come up with an appropriate strategy of how to deal with any overtime its loan officers may have logged in the past two to three years. Employers also face the prospect of collective actions or individual claims from mortgage loan officers who worked, but did not receive overtime pay during the past three years.