June 6, 2006

Washington Mutual sued for not paying overtime

By Jonathan Stempel

NEW YORK (Reuters) - Three former mortgage brokers of
Washington Mutual Inc., the largest U.S. savings and loan, have
sued the company for allegedly shortchanging them out of
overtime and paying them less than the federal minimum wage.

The lawsuit, filed on Monday in U.S. District Court in
Brooklyn, New York, seeks class action status.

Jack Raisner, a lawyer with Outten Golden LLP, which
represents the plaintiffs, said Seattle-based Washington Mutual
deprived at least hundreds of brokers of their proper pay.

The lawsuit accuses the thrift of requiring home loan
consultants, as its mortgage brokers are known, to work more
than 40 hours per week and failing to pay them for the extra
hours when approval was not granted for loans they handled.

According to the lawsuit, forcing the employees to work
long hours without paying overtime regularly drove hourly pay
below the federal minimum wage of $5.15 an hour.

The plaintiffs are seeking back pay with interest,
attorneys' fees and an injunction, according to a filed copy of
the lawsuit.

Calls to Washington Mutual were not immediately returned.

Washington Mutual is the No. 3 U.S. mortgage lender, and
employs about 16,000 people in its home loans unit.

"From what we can tell, it's a problem throughout the
company's organization," Raisner said. "Workers were basically
working 60 or 70 hours a week, but they were working on
commissions. The law is that if you are working on commissions,
you must be offered premium pay for overtime hours worked."

The named plaintiffs are Dewone Westerfield, of Grand
Rapids, Michigan, who had worked for the thrift in Chicago;
Patricia Kemesies, of East Islip, New York, who had worked in
nearby Hauppauge; and Charlotte Machado of Trussville, Alabama,
who had worked in Modesto, California.

Citigroup Inc., Merrill Lynch & Co., Morgan Stanley and UBS
AG have in the last year each agreed to pay tens of millions of
dollars to settle lawsuits accusing them of shortchanging
stockbrokers out of overtime.

"Wall Street has owned up to the fact that its stockbrokers
were owed overtime," Raisner said. "These mortgage brokers are
paid far less, and if anything the law for them is even more