Brokerage firms have been settling a number of wage-and-hour violation charges. Many of the so-called collective action claims have been filed against several big brokerages alleging that the firms made a regular practice of failing to pay overtime to their sales assistants in violation of the federal Fair Labor Standards Act (see January 98 RR, Page 38). Collective action cases are similar to class actions.

Without denying or admitting guilt, PaineWebber and Raymond James have settled. Both cases against the firms were filed in June 1997. The PaineWebber case was settled at the end of January; the Raymond James case in early July.

Another case filed against Smith Barney in July 1997 in federal district court in Miami was in settlement discussions as of July 98. We are in confidential settlement negotiations right now, and we are unable to make a comment at this time, says a spokesperson for the plaintiffs attorney in the case, Jonathan Perlman, of the Miami law firm of Blum Perlman & Cherdack.

Salomon Smith Barney would not comment on the settlement discussions.

Another largely identical wage-and-hour case is pending against Salomon Smith Barney in Miami, filed by Tampa, Fla., attorney Jonathan Alpert. That case was originally filed in Tampa in October, and was since moved to Miami, where it is now pending before the same judge.

However, the firm has refused to negotiate with him, Alpert says. Smith Barney is negotiating only with Perlman, and I am puzzled, he says.

Alpert has served as the plaintiffs attorney on most of these actions, including one that was settled with Prudential Securities in May 1997 for $4. 5 million. He also represented plaintiffs in the PaineWebber and Raymond James cases. Another suit Alpert initiated against Sutro in August 1997 never became a collective action, he says, though the one plaintiff named in the court filing as the representative of a potentially larger group got a settlement, Alpert says.

Sutro did not respond to calls seeking comment.

Meanwhile, an action filed against Dean Witter in federal district court in Denver has entered the discovery phase. Weve been allowed to do discovery so far in only one office, but in that office, we found over 5,600 hours of reported overtime by 30-some, non-exempt workers, all of them female, over a three-year period, says Denver attorney John Holland, one of the plaintiffs attorneys. He claims that with penalties for willful violation, the amount of money involved would be about $200,000 for the one office. If thats a common practice in all of their offices, you can see the scope of the problem, he says.

A Morgan Stanley Dean Witter spokesperson declined comment, citing the pending litigation.

The MSDW case is somewhat different from the others in that the plaintiffs attorneys are pursuing a second claim that unpaid overtime impacts women disproportionately and is therefore a class-wide violation of Title VII, the federal civil rights act. That part of the case has traveled a bumpier road.

According to Denver attorney Kathleen Mullen, who also represents the plaintiffs, the motion for class-action status was at first denied by a judge who later stepped down because of a conflict of interest. The sex discrimination charges could be reopened if we come up with more evidence of a national policy or practice, she says.

A deposition has been scheduled with the head of the firms payroll department. If the deposition results fail to convince a magistrate to allow discovery on the sex discrimination charges, Mullen threatens to appeal. She claims discovery should be allowed before a Title VII case is denied.

As part of the settlement, neither side in the Raymond James case can comment beyond a press release issued by the firm.

However, the St. Petersburg Times reported some comments made at the public hearing (no transcript is available from the court). The settlement was estimated as being worth at least $750,000, plus legal fees, and the number of employees who are eligible was estimated at between 300 and 500. The expected payment per employee ranges between $1,500 and $2,500, the paper reported, though some of the sales assistants have already been compensated, including one in Coral Gables who received $15,000 as a result of the firms investigation into its own overtime practices. The period of time for back pay was two years, starting on June 1, 1996.

Alperts $253,000 fee in the Raymond James case has been questioned by the judge, who said she wanted to review the firms billing records, according to the St. Petersburg Times. Raymond James had agreed to pay the fee.

The PaineWebber settlement agreement, filed on Jan. 30 in the U.S. District Court in Tampa, said that the firm would make no less than $1.5 million and not exceeding $3 million available for the settlement of claims, with another $175,000 set aside for administrative costs. The firm also paid $700, 000 to Alpert as the plaintiffs attorney. The period of time covered was three years, starting on Oct. 17, 1994.

A PaineWebber spokesperson says only that the case has been resolved, and would not comment on the number of claims that had been submitted during the opt-in period last winter, or the final amount of the settlement.