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ESA News Release: [11/02/2007]
Contact Name: Diana Petterson or Elizabeth Todd
Phone Number: (214) 767-4776, x222 or 221
Release Number: 07-1474-DAL

U.S. Labor Department recovers nearly $2 million in back pay for Houston home mortgage employees

HOUSTON — Allied Home Mortgage Corp. in Houston has paid $1,855,518 in back wages after an investigation by the U.S. Department of Labor's Wage and Hour Division found 588 branch managers, loan officers, loan processors and clerks, who were performing inside sales work at the company, had not been properly paid.

"Among this department's highest priorities is ensuring that workers are paid all the wages they have earned," said Secretary of Labor Elaine L. Chao. "In this case, we have recovered almost $2 million in back wages for these workers, and their employer is on notice to properly compensate for overtime in the future."

The investigation, covering a period of more than two years, determined that Allied Home Mortgage violated the overtime provisions of the Fair Labor Standards Act (FLSA) by not paying an overtime premium to commission-only employees. The company is one of the largest privately held mortgage brokers in the United States with about 700 offices in 49 states, Guam and the Virgin Islands. The company cooperated with the investigation by conducting a self-audit and has agreed to future compliance. Back wages have been paid in full.

The FLSA requires employees to be paid minimum wage for all hours worked and time and one-half their regular rates of pay for hours worked over 40 per week. Employers must also maintain accurate time and payroll records. Earnings may be determined on a piece-rate, salary, commission or some other basis, but in all such cases the overtime pay due must be computed on the basis of the average hourly rate derived from such earnings. The FLSA provides an exemption from both minimum wage and overtime pay for bona fide executive, administrative, professional and outside sales employees.

For more information about federal overtime laws, call the U.S. Department of Labor's toll-free helpline at 866-4US-WAGE (487-9243) or contact the Wage and Hour Division's district office in Houston at 713-339-5500. Information is also available on the Internet at www.wagehour.dol.gov. Information about the current exemption can be found on the Internet at www.dol.gov/fairpay.

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