After deducting about $9 million in legal fees, the rest of the money will be split among as many as 3,000 brokers, according to a New York Times report. Some will receive more than $15,000 but most will get less than $10,000, lawyers involved in the case said.
US District Judge Maxine Chesney has scheduled a September 9 hearing to review the agreement. The lawsuit, filed for the firm’s California brokers, charged that brokers should be paid overtime for staying on the job more than eight hours in a day or 40 in a week.
A year ago, the federal Fair Labor Standards Act was changed to exempt white-collar workers earning more than $100,000 a year from overtime provisions. But that $100,000 has to include at least $455 a week in salary and the employee has to perform at least some administrative duties. It may not apply to stock brokers because of the way they are paid, lawyers said.
According to the Times report, plaintiffs’ lawyers are soliciting Merrill brokers in New York to join a similar suit in that state, which is home to more stockbrokers than any other.
For its part, the company claims it was better off agreeing to the settlement. “We believe it was in the best interests of our clients, our financial advisers and the firm to avoid litigation and settle this matter.” Mark Herr, a Merrill spokesman, told the newspaper.