Connecticut Insurance Underwriter Wins Overtime Wages in First-of-a-kind Federal Ruling

    HARTFORD, CT, June 03, 2015 /24-7PressRelease/ -- A jury found on May 15 that, under federal law, an insurance underwriter had been illegally denied overtime pay by a former employer. Attorney Richard Hayber, who represented the insurance underwriter, said the verdict was the first in the nation to find that insurance underwriters are not exempt employees.

"This case is a major victory for insurance underwriters and other employees who have been wrongfully classified as exempt," Hayber said.

The plaintiff sought unpaid wages from Chubb & Son, Inc., where he had worked as an insurance underwriter. Underwriters for insurance companies apply company rules to generate a quote for a specific insurance policy.

Under the Federal Fair Labor Standards Act (FLSA), all employees must be paid at least a minimum hourly wage ($7.25 under federal law and $9.15 under Connecticut law) for up to 40 hours per week. For any hours past 40 worked in a week, the employer must pay the employee 150 percent of his or her normal wage, or "time-and-a-half."

The employer may pay the employee on a salary basis if their job description meets certain exemptions. The exemptions are to be narrowly applied.

In this case, the employer classified the employee as exempt under the "administrative" exemption. To meet the administrative exemption, the employee must make at least $475 per week, and have a primary duty that consists of performing office or non-manual work directly related to the management or general business operations of the employer or of the employer's customers. Their duties must involve exercising discretion and independent judgment over matters of significance.

In this case, the plaintiff's primary duties consisted of processing applications for policy renewals through the company's automated system and applying the company's guidelines to determine the terms in the renewal policy. He worked more than 40 hours per week, and even though his duties did not qualify for an exemption from the Fair Labor Standards Act, Chubb & Son did not pay him overtime premium pay.

The jury found that that Chubb & Son wrongfully applied the exemption, and that the plaintiff's overtime rate may not be determined using a "fluctuating work week" model. The jury further determined that the company owed the plaintiff more than $18,000 in unpaid overtime pay.

The case is remarkable because it is the first time a jury has found that an insurance underwriter is not exempt under the FLSA, Hayber said. The Second Circuit Court of Appeals had previously found that loan underwriters were not exempt under the administrative exemption because they were on the "production" side of the business, rather that the administrative side.

"Any insurance underwriter who is being paid on a salary basis should speak to an employment lawyer," Hayber said. "He or she could be owed significant back wages for unpaid overtime."

The plaintiff was represented by Hayber and Anthony Pantuso of the Hayber Law Firm, a Hartford-based firm that represents workers against their employers throughout Connecticut.

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