Underwriters Entitled to Overtime

On Friday, November 20, 2009, the Second Circuit delivered an opinion holding that loan underwriters at J.P. Morgan Chase are entitled to overtime wages under the Fair Labor Standards Act.  This is an important decision dealing with an issue that, up until last Friday, had not been definitively decided by the Second Circuit.  The Second Circuit is made up of Connecticut, New York, and Vermont.

Plaintiff-Appellant Andrew Whalen argued that, during his four years as a loan underwriter for Chase, he was incorrectly categorized as an overtime exempt employee, that he worked overtime frequently during that time, and that the District Court had incorrectly dismissed his case against Chase.  The Second Circuit agreed, reversing the decision of the District Court.

The Second Circuit held that Whalen’s work as an underwriter constituted “production” work rather than “administrative” work.  Employees who perform administrative duties may be exempt for the purposes of the Fair Labor Standards Act, but employees who are engaged in work that is classified as production work are generally not exempt from being paid overtime wages, absent some other exception within the statute.

Underwriters (perhaps even including insurance underwriters) around Connecticut and the rest of the country should take notice that they too may have a claim for overtime compensation, regardless of whether their employer has classified them as exempt from overtime payments.

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