The National Association of Mortgage Brokers has obtained an opinion from the Department of Labor that says that "sales force" loan officers can qualify as outside sales employees exempt from some pay rules.
The opinion could mean that most loan officers not working in call centers do not have to be paid overtime or minimum wage.
It eliminates some of the controversy caused by a previous clarification from the department in August 2004, according to Joe Falk, the chairman of the trade group's legislative committee.
The previous opinion created some controversy, because it appeared to create the same rules for traditional loan officers as would apply to ones who operate in a call-center environment. The new letter clearly differentiates between the two, he said.
"We're very happy about it," the group's president, Jim Nabors, said at the National Home Equity Mortgage Association's annual convention in Miami this month. "It's a home run for NAMB."
The Department of Labor's latest letter was signed by Alfred B. Robinson Jr., the acting administrator for the department's wage and hour division, which enforces overtime regulations. The letter carries the weight of legal precedent and can be used by an employer sued for violations.
Mr. Robinson wrote that sales force loan officers working mainly outside of call centers meet the "sales" requirement for the exemption from the pay rules. Furthermore, "by meeting clients outside of the employer's place of business in order to initiate sales, such as at the clients' homes, the 'sales force' loan officers fulfill the 'outside' requirement" of the exemption.
"Activities employees perform that are incidental to their outside sales or solicitations also qualify as exempt outside sales work, but only if the incidental activity is in support of their own sales and not just generally 'directed towards stimulating the sales of … [the] company,' " the letter added. Sales force loan officers also can be exempted even if they perform some activities in their place of business, "so long as the inside sales activity is incidental to and in conjunction with qualifying outside sales activities."
The letter does include a caveat: Each sales force loan officer has to be evaluated individually to see if he or she qualifies for the exemption.
