Merrill Reaches Half-Million-Dollar Settlement in Overtime Class-Action Suit
Merrill Lynch has agreed to pay $550,000 to settle overtime claims from 51 current and former compliance employees who were responsible for reviewing broker e-mails, according to a preliminary agreement filed in U.S. District Court in New Jersey.The total represents just over half of Merrill Lynch’s maximum liability of $1,052,000 in damages, but the employees believe the settlement amount is reasonable because it allows them to avoid “significant litigation risks” and expenses, according to a petition for approval filed on Monday.
Judge Freda L. Wolfson said they would “face a significant hurdle” if the case went to trial when she granted a conditional class certification.
A spokesman for Merrill Lynch, which denied the allegations and challenged the damage calculations, declined to comment.
The lead plaintiff, Jennifer Porter, was a 17-year Merrill employee who brought her class-action claim in October 2017, after she had been terminated in April for poor performance. She alleged that Merrill had misclassified her and other supervision analysts working in Pennington, New Jersey, as exempt from overtime, violating the federal Fair Labor Standards Act as well as New Jersey’s Wage and Hour Law.
Merrill asserted in court papers that the scope of the supervision analyst position went beyond email review, permitting the firm to apply “administrative” and “professional” exemptions to the employees. It also argued in opposition to the claim for class certification in May 2018 that the job duties of the employees were too individualized to constitute a class.
The plaintiffs’ lawyers, Louis Pechman and Mitchell Schley, did not return requests for comment. In their petition for approval, they requested 33% of the settlement amount, or $181,333.33, as well as up to $10,000 in costs.
Porter and her colleagues were rote email reviewers who were scheduled to work 40-hour weeks but frequently extended their 8:30 a.m-to-5:30 p.m. schedules and also did email reviews from home after hours and on weekends, according to the initial complaint.
Their job encompassed reviewing messages in Merrill’s Autonomy Supervisor database, double-checking that flags about potentially problematic communications were legitimate and elevating those that were to administrators, according to the complaint. They reviewed for “guarantees” by brokers of investment returns, vulgar language, ethnic slurs, pornographic material and material marked as “For Internal Use Only,” among other characteristics, the lawsuit said.