WASHINGTON — Credit union mortgage lenders are having to wrestle with how they will employ and pay their mortgage loan originators after a ruling from the Department of Labor that mortgage originators are not exempt from wage and hour laws.

Kris Kelly, an attorney with K&L Gates, told CU mortgage executives attending ACUMA's Regional Workshop in Washington DC that credit unions and other mortgage lenders used to consider mortgage originators as administrative employees and thus exempt from wage and hour laws that require time-and-a-half pay rates for work exceeding 40 hours per week, but an administrative interpretation from the Department of Labor that loan originators did not fall into that exempt category has thrown the question into confusion. Loan originators have generally been paid a salary plus a commission.

Kelly told the meeting that a lawsuit from the Mortgage Bankers Association might delay the impact of the interpretation by forcing the Department to go through a formal rule-making process, but added that it looked like the Department would only come back to the same policy.