LendUS accused of pressuring employees not to report overtime hours

Two former assistants at LendUS, a California-based mortgage lender acquired by CrossCountry Mortgage in 2022, are suing their employer for allegedly stiffing them and others of overtime compensation owed, thereby breaching a federal labor law.

A suit filed in a federal court in California claims LendUS instituted a policy of discouraging loan assistants and processors from reporting overtime work. This alleged behavior went as far as threatening to boot employees from their jobs if they reported that they worked over 40 hours. This was done as a way to "save on labor costs," the complaint filed April 23 said. 

Barbara Greist, who worked at LendUS from 2017 to 2022, and Susan Schell, who was at the company from 2019 to 2022, are suing on behalf of themselves and other loan assistants and processors similarly impacted by their former employer's practices. The pair is hoping to get the suit certified as a class action, which would include "hundreds of loan assistants and loan processors."

CrossCountry Mortgage, the successor-in-interest to LendUS, declined to comment on pending litigation. Legal counsel for the plaintiffs did not immediately respond to a request for comment Wednesday.

The complaint accuses LendUS of breaking the Fair Labor Standards Act (FLSA), a federal labor law that established a worker's right to a minimum wage. Since loan assistants and processors were paid on an hourly basis and were "non-exempt," they were entitled to overtime compensation at the rate of one-and-one half times their regular rate of pay for all time worked over 40 hours per week, the suit says.

Per the two plaintiffs, the policy of not reporting overtime work was in place notwithstanding the fact that the now defunct mortgage lender "assigned work to loan assistants and loan processors that could not reasonably be completed in a 40-hour work week." As such, employees "regularly worked more than 40 hours in a work week off-the-clock, without compensation for overtime hours worked."

The complaint requests a jury trial to take place and for the court to grant the plaintiffs unspecified damages, including liquidated damages, to be paid by defendants according to proof for plaintiff and the collective.

Lenders such as Fairway Independent Mortgage CorpRocket Mortgage, and Freedom Mortgage have also had FLSA complaints lodged against them. Of the 27 FLSA complaints filed against lenders from April 2022 to April 2023, 12 have closed under various circumstances.

In one rare publicly available settlement, Better.com in March pledged to pay a former mortgage underwriter $14,000, including $7,000 in back wages and $7,000 in liquidated damages, after she sued the lender last January in a Florida federal court for its alleged failure to pay overtime.