According to Investment News, an ex-employee of Wells fargo, Erika Williams, has filed a lawsuit claiming that the firm’s attempt to recoup $50,000 in training costs violates labors laws. According to the report, Ms. Williams earned an annual salary of $45,000 and was in the program for about a year until she was let go for failing to meet standards. Ms. Williams claims that if she has to repay the trainings costs, which is about $5,000 more than her salary, Wells Fargo will be in violation of minimum wage laws.
The report states that Wells Fargo trainee program is a five year agreement valued at $55,000. After the first year, the amount a trainee owes decreases at a set rate each month until it is fully amortized at the end of the agreement terms.
Most brokerage firms have similar trainee program contracts. The contracts are designed to protect the the firms from incurring losses from brokers who go through training only to jump to another firm. According to InvestmentNews, Ms. Williams case, which seeks class action certification, is one of the first to challenge the common practice of training program agreements at some of the nation’s largest brokerage firms.
The White Law Group often represents financial advisor’s in trainee costs disputes. While the minimum wage law argument may not work for all financial advisors (depending on the salary earned and the length of time spent at the firm), there are other defenses to such claims that can be effective.
If you are a broker being sued for trainee costs by your former broker-dealer, please call the securities attorneys of The White Law Group at (312)238-9650 for a free consultation. The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Boca Raton, Florida.
To learn more about The White Law Group, visit www.WhiteSecuritiesLaw.com.