Wage and Hour Division (WHD)

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DETROIT --

Shore Financial Services Inc., a residential mortgage lending company doing business as Shore Mortgage in the Detroit metro area, has paid $156,348 in back wages to 224 employees for violations of the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA).

An investigation by the U.S. Department of Labor’s Wage and Hour Division disclosed that “trainee” loan officers were paid a fixed amount at the end of the month during their initial two-month training period. Trainees who left the firm before the end of the month received no pay for that month. In addition, hourly-paid office employees who processed loans were not paid overtime premium pay on bonus amounts they earned. The employer also failed to keep records of hours worked by some employees. The violations occurred from November 2002 to October 2004.

“The Labor Department is committed to ensuring that all workers receive all of the wages they are owed,” said James Smith, district director of the department’s Wage and Hour Division in Detroit.

The Wage and Hour Division determined that the company owed 195 trainees $149,987 in minimum wage and overtime compensation; 29 loan processors who were paid overtime pay at an incorrect rate were due $6,361 in additional overtime pay. The company agreed to full future compliance and to pay all back wages due.

The FLSA requires covered employees to be paid the minimum wage for all hours worked and time and one-half the regular rate of pay for hours worked over 40 in a week. In general, non-discretionary bonuses must be added to other straight-time earnings in calculating the proper overtime pay rate. Employers must also maintain accurate time and payroll records.

Shore Financial Services is headquartered at 770 S. Adams, Birmingham, Mich. The company has branch offices in Brighton, Canton Township, Grand Blanc, Roseville, Taylor, Huntington Woods, Ann Arbor, and Shelby Township.

The Wage and Hour Division recovered nearly $200 million in back wages in fiscal year 2004 for more than 288,000 workers. For more information about the FLSA, call the Department of Labor’s toll-free help line at 1-866-4USWAGE (1-866-487-9243). Information is also available on the Internet at www.wagehour.dol.gov.

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U.S. Department of Labor releases are accessible on the Internet at www.dol.gov. The information in this news release will be made available in alternate format (large print, Braille, audio tape or disc) from the COAST office upon request. Please specify which news release when placing your request at (202) 693-7828 or TTY (202) 693-7755. The Labor Department is committed to providing America’s employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit www.dol.gov/compliance.