New DOL Opinion on Overtime for Financial Advisors and Stockbrokers

Update (12/27): Here is the actual opinion letter.

Rosario Vega Lynn at the New Mexico Labor and Employment Law Blog points out that the Department of Labor (DOL) Wage and Hour Division has issued a yet-to-be published opinion letter finding that certain financial advisors and stockbrokers who receive a guaranteed draw plus commission are not entitled to overtime compensation.

Rosario explains:

The employer requesting the opinion from the DOL described the duties the registered representatives to include collecting clients’ financial information (including assets, income, debts and other liabilities, cash flow and tax status), analyzing the information, comparing and evaluating possible investment options, and identifying investment strategies and potential investments based on their knowledge of market conditions and clients’ particular circumstances. 

According to the DOL, the employees fall within the administrative exemption of the FLSA, and therefore would not be entitled to overtime pay. The Code of Federal Regulations allows an administrator to be exempt as long as the salaried employee’s primary duty must be non-manual work, directly related to the management or general business operations of the employer or the employer's customers, and he or she must exercise discretion and independent judgment with respect to matters of significance.

The DOL Opinion letter is dated November 27, 2006.

PS