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$39 Million Settlement In Stock Brokers’ Wage And Hour Case Receives Preliminary Approval

The National Law Journal is reporting that a federal judge in Los Angeles has approved a $39 million preliminary settlement to resolve the multidistrict litigation between Wachovia Corp. and more than 10,000 stock brokers who alleged that they were denied overtime pay and other wages.

“U.S. District Judge David O. Carter also approved a final settlement in which Prudential Financial Inc., whose retail brokerage division was sold to Wachovia in 2003, agreed to pay $11 million to former stock brokers.

The settlements approved on May 11 are the latest involving overtime allegations brought by stock brokers. (In re: Wachovia Securities Wage & Hour Litigation, MDL No. 1807 (C.D. Calif.))

The stock brokers, referred to as financial advisers or financial adviser trainees, alleged that they were misclassified as exempt from overtime under the federal Fair Labor Standards Act (FSLA) and state wage and hour laws.

They also claimed that they were not reimbursed for business expenses and did not receive timely paychecks upon leaving the company.

California stock brokers alleged that they were not given breaks for meals and rest periods as required by state law.

In its motion for preliminary approval, Wachovia, recently acquired by Wells Fargo & Co. Inc., said that the recent change in its corporate ownership would result in changes in policy and practices that could complicate the litigation.”

The article said that those affected by the settlement are financial advisers and trainees who worked for Wachovia Corp., Wachovia Securities LLC or First Union Securities Inc.  “Most of the class members must make FLSA claims, but subclasses in the settlement are identified for workers with state claims in California, Illinois, Minnesota, Pennsylvania, New Jersey, New York and Ohio.”

A final approval hearing is set for Oct. 5, 2009.

To read the full article go to the National Law Journal’s website at $39 million settlement in stock brokers’ wages-and-hours action