Citigroup settles with stockbrokers
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SCOTT JAGOW: There are a lot of suits on Wall Street. Lawsuits. Stockbrokers have been suing their employers because of the way they get paid. Citigroup is the latest company to settle. An attorney for a group of plantiffs says Citigroup has agreed to hand over $98 million in unpaid overtime. Marketplace’s Amy Scott has more.
AMY SCOTT: UBS, Merrill Lynch, and Morgan Stanley have all settled similar lawsuits. Several more are in the works. The lawsuits argue that stockbrokers are technically salespeople. And because they’re paid commissions, not salaries. they’re entitled to overtime pay. Stockbroker Senay Wayne says he works between 70 and 80 hours a week. Time-and-a-half pay would go a long way.
SENAY WAYNE: Yeah, you could say, okay, well the guy makes a hundred grand a year. But it doesn’t matter. We’re still working hard making people money. So yeah, I think we should get compensated for the hours.
Observers say the lawsuits may inspire brokerage houses to switch to a salary system to avoid paying overtime. The attorney behind the lawsuits says his average client is owed about $30,000 in unpaid wages. But if brokerages move to a flat salary, many brokers would likely earn less without those high-percentage commissions.
In New York, I’m Amy Scott for Marketplace.