Tri-State Mortgage agrees to pay $66,456 in back wages
By PAULA PARISOT
3/29/2005

An Indiana mortgage broker has agreed to pay substantial back wages for originators that weren't paid at least minimum wage.

Evansville-based Tri-State Mortgage Inc. has agreed to pay $66,456 in back wages and $606 in overtime wages to employees following an investigation by the U.S. Department of Labor, according to federal officials.

The investigation disclosed that under the Fair Labor Standards Act (FLSA), 59 loan originators were not paid enough in commissions to meet the federal minimum wage guidelines for several weeks and one employee was not paid for overtime hours.

In a recent announcement regarding the investigation, the District Director of the Department's Wage and Hour Division in Indianapolis Ella Johnson said, "The Labor Department is committed to vigorously enforcing the law to ensure that employees are paid all of the wages they are owed."

Officials added that Tri-State failed to keep accurate records of hours worked by its employees. It is not clear whether the employees in question are currently employed by Tri-State.

The company did not respond to requests for a statement.

According to FLSA law, covered employers are required to pay employees at least the federal minimum wage for all hours worked (Indiana's minimum wage is $5.15), and overtime premium pay of time-and-one-half the regular rate of pay for all hours worked over 40 in a single workweek. However, the law allows for a number of exemptions from these requirements.

Examples of exempted employees include "any employee employed in a bona fide executive, administrative, or professional capacity...or in the capacity of outside salesman (as such terms are defined and delimited from time to time by regulations of the Secretary, subject to the provisions of the Administrative Procedure Act...)."

March 2004-revised regulations state that Congress has never defined the term "outside salesman," but that the "exemptions were premised on the belief that the workers exempted typically earned salaries well above minimum wage."

The FSLA law also requires the employer to maintain accurate personnel records for each nonexempt employee including hours worked, wages earned, and the basis on which employee's wages are paid.

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