The US$2.5-trillion multinational finance firm JPMorgan Chase & Co. has offered 1,056 financial advisors US$5.7 million to cease a lawsuit accusing the firm of underpaying them on overtime.
The settlement is being offered to current and former JPMorgan employees, reports Law360.
Jeffrey Lloyd and Ellen Szymkiewicz filed the original suit in 2011, claiming that JPMorgan had violated state and federal overtime laws. Kenneth Ciulo filed a similar case the following June, which the court accepted as related.
According to the legal news site, Judge Laura Swain from the US Southern District of New York previously ruled that if any plaintiff advisors had signed any version of Chase’s arbitration agreement governed by American Arbitration association rules, JP Morgan could compel them into arbitration. However, some had signed an alternate version governed by the Financial Industry Regulatory Authority (FINRA), allowing them to pursue the class action.
After an “extensive” discovery period and an appeal to the Second Circuit, the proposed settlement was presented to appease the plaintiffs, who came from New York, New Jersey, and California. It is still awaiting Swain’s tentative approval.
Other brokerage firms have faced overtime-related lawsuits in recent years. At one point, Morgan Stanley was accused of stiffing trainees on overtime pay in four collective class actions, which it settled in June to the tune of US$6 million.
In August, another class action claimed that Merrill Lynch violated state and federal laws on overtime pay; just before that suit was filed, the wirehouse had paid a $14-million settlement for another lawsuit involving trainee wages.
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