Financial services firm faces FLSA lawsuit
A large financial services firm could be facing an employee time lawsuit under the Fair Labor Standards Act for attempting to make a former employee repay broker training costs.
Investment news reports the company is looking to get back money in excess of $50,000 from the plaintiff who left the organization after completing one year of a five-year broker training program, an industry standard. The firm values its total training costs at $55,000 and says for the next four years, the plaintiff is required to pay back a set amount every month until amortization is reached.
The suit, filed in the U.S. District Court of Northern Illinois, alleges the company would be in violation of the minimum wage law under the current FLSA guidelines, since the money associated with training is said to be worth $5,000 and the trainee was paid a salary of $40,000 per year.
The federal minimum wage is currently $7.25, however, states have their own individual minimum wage laws and there are instances where employees are not governed by both. Currently, the minimum wage in the State of Illinois is $8.25 per hour.
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