CrossCountry Mortgage accused of failing to pay its employees
CrossCountry Mortgage employees claim that the lender failed to pay them when mortgage activity slowed down last year. Paul Lundholm, Lyndhurst, New Jersey, filed a class action complaint Tuesday in the U.S. District Court of the Northern District of Ohio. According to court filings, the Cleveland-based company paid employees on a commission-based basis and did not pay any compensation for the time staff didn’t close loans last fiscal year. Lundholm’s attorneys said that there were weeks when many people didn’t earn commissions. CrossCountry could then sue for the back of the compensation it paid employees. “In our view they were trying to shift all the risk of the turn of the market onto these individuals,” said attorney Brendan Sweeney of The Law Office of Christopher Q. Davis, PLLC in New York City, on behalf of Lundholm.CrossCountry sued Lundholm earlier this month in the Cuyahoga County Court of Common Pleas in Cleveland, seeking damages of $81,371.83 related to his signing bonus. According to both parties, Lundholm signed a $135,000 sign on bonus agreement. This sum will be divided into two payments. CCM’s suit includes two earnings statements that show Lundholm receiving $81,030.46 in payments. This amount is to be paid over two payments. According to the text, tax consequences are the responsibility of an employee. Each party waives its right for a trial by jury for actions arising from the agreement, a violation the FLSA. Lundholm’s counsel stated that a representative for CCM and Joseph Mallernee, counsel for CrossCountry, declined to comment Thursday. The class action complaint states that Lundholm was employed remotely as a loan salesperson, selling mortgages to borrowers, between April 4, 2022 to Nov. 2, 2022. CCM claims Lundholm resigned voluntary, which his attorneys dispute, but their lawsuit doesn’t provide any details about the reason. According to the suit, Lundholm and other workers were incorrectly classified by CCM as exempt from federal overtime requirements. They worked more than 40 hours per week. CCM allegedly failed to keep accurate records of employee hours, didn’t provide a guaranteed weekly income of at least $455.00 per federal and state laws, and failed pay workers at least twice per month. “There were many weeks when they weren’t closing any loan, and where they were getting zero compensation,” stated Anthony Lazzaro, Ohio-based The Lazzaro Law Firm, LLC on behalf of Lundholm. “So, in those weeks we’re finding minimum wages violations. Those claims have been supported by many. “Loan originators, senior loan officers, and loan officers are all part of the proposed class. The amount of damages is not specified, but it is more than $75,000. There have been wage disputes between mortgage companies and their employees. United Wholesale Mortgage settled an overtime claim with account executives last spring for $2.75 Million. CCM is now one of the largest lenders in the industry, with $53.5 billion in total lending volume in 2021, and $31.8 billion between Oct. 31, 2022 and Jan. 1, 2022, according to S&P Global data. Although the lender had more than 7,000 employees in 2021 it is not clear if it has suffered layoffs like many other industry players. The lender denies that it has been accused of poaching talent. A federal judge dismissed Guild Mortgage’s claims of raiding a Washington branch in 2021.