A former CrossCountry Mortgage employee is suing the company over claims of unpaid wages and overtime.
Paul Lundholm, of New Jersey, said in a lawsuit filed this week in federal court that CrossCountry “knowingly misclassified loan salespeople as being exempt from overtime, failing to pay them required minimum wage and overtime,” in violation of both the Federal Labor Standards Act and New Jersey Law.
The lawsuit also accuses CrossCountry of using sign-on bonuses to unlawfully get employees in New Jersey to sign away their rights.
Earlier this month, CrossCountry filed a lawsuit in Ohio trying to recoup $81,371 of a $135,000 bonus paid to Lundholm because he left the company within two years, in violation of the bonus agreement.
Lundholm is seeking class action status on behalf of fellow loan salespeople, originators, and other company employees in New Jersey.
CrossCountry did not respond to a request for comment Friday afternoon.
The lawsuit states that loan salespeople are not responsible for general business management, nor did they have the ability to “exercise discretion or independent judgment with respect to matters of significance” in their own jobs.
According to the lawsuit, CrossCountry dictated the terms of Lundholm’s employment, including the nature of his work, his pay, and whether he was classified as exempt from overtime.
Lundholm said he routinely worked more than 40 hours a week, but was paid compensation only for sales. During this period, he said, he was not guaranteed a minimum weekly paycheck of at least $455 per week, as stipulated by New Jersey and federal minimum wage requirements.
CrossCountry also made no effort to track how many hours Lundholm worked, he said.
Lundholm agreed to a sign-on bonus when he joined CrossCountry in April, paying him a total of $135,000 and requiring that he stay with the company for two years. Employees who left prior to 24 months of employment agreed to repay the bonus.
But employees must sign away rights, including to minimum wage, and agree to a lien against wages, accrued vacation time, bonus, and other compensation due at the time of termination, the lawsuit states.
In its Ohio lawsuit, CrossCountry claimed Lundholm still owes $81,371 as the unpaid balance of his bonus. Lundholm's lawsuit states that the terms, including attempts to recoup the bonus, violate the FLSA.
His lawsuit is just the latest in a series of legal fights over employee compensation in the mortgage industry.
Just last month, some former Rocket Mortgage employees filed a lawsuit in federal court in Arizona over unpaid wages.
In December, a federal court in California ruled PNC improperly docked some employees pay when they didn't meet certain thresholds because the compensation scheme essentially meant they worked during unpaid breaks.
In June, United Wholesale Mortgage (UWM) agreed to a $2.75 million settlement with employees who sued the company over unpaid overtime.
