Free Response to Motion - District Court of Colorado - Colorado

Case 1:03-cv-02485-MSK-PAC

Document 345-15

Filed 02/16/2006

Page 1 of 7

Page i
1

2 3
4

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION
DUANE McCLAIN and
ALES IA MILES,

5
6

Plaintiffs,
vs.
CIVIL ACTION FILE NO.1: 05-CV-0416-TWT

7
8

HEARTLAND HOME FINANCE,

INC. ,
9

Defendant.

10 11 12

13 Rule 30(b) (6) Deposition of DONALD L. 14 FLYNN, taken on behalf of the Plaintiff, pursuant
15 to the stipulations contained herein, before Lori 16 Roy, RPR, CCR No. B-2278, at Suite 1100, 1180 West 17 Peachtree Street, Atlanta, Georgia, on Wednesday,
1 8 Au g us t 1 7, 2 0 0 5 , co mm en c i n gat the h 0 u r 0 f 9: 0 0

19 a.m.
20 21 22

23 Shugart & Bi shop

24 Suite 300, Building 27
SHUGART & BISHOP

Certified Court Reporters
1640 Powers Ferry Road

25 Marietta, Georgia 30067

Case 1:03-cv-02485-MSK-PAC

Document 345-15

Filed 02/16/2006

Page 2 of 7

Page i 4

1

never seen any overtime hours recorded on time

2
3
4

sheets?

A That's correct.
Q Is there any other circumstance
underwhich you've reviewed loan officer time sheets?

5
6 7
8

A I can't recall any other time that
I've reviewed employees' time sheets.

Q Moving on to -- I'll ask you more
about the time sheets later. Moving on to method
of compensation, at your last deposition, you
testified that prior to July of 2002 the loan officers were paid strictly commissions and that
there was no draw; is that correct?

9

10 11 12

13
14

15

A I believe that was my testimony, yes. Q So would you agree that prior to July
of 2 0 02 if a loa n 0 f f ice rea r n e d no c omm is s ion s i n

16
17 18

a pay period, they would not be earning minimum

wage, right?
MR. CARR:

19

Obj ect to the form of the

20 21
22

question.
You are free to answer if you can.
THE WITNESS: I f they didn' t receive

23
24

any commissions, the only money they would
have received would have been a loan or an

25

advance.
SHUGART & BISHOP

Case 1:03-cv-02485-MSK-PAC

Document 345-15

Filed 02/16/2006

Page 3 of 7

Page 16

1

me if I'm wrong, you stated that there was -- the
loan officers nationwide were paid a draw against
c omm is s ion s; is t hat cor r e c t ?

2 3
4

A Since July of 2002 loan officers get
have received draws.

5
6 7
8

Q So it didn't end February 1, 2004 or
anything. That's been the policy since July of
2002 to date, correct?

9

A Yes.
Q And it's my understanding that under
that policy, every loan officer on a nationwide

10 11
12

basis receives a $500 draw per pay period; is that

13
14

correct?

A There would be situations where they
would not.

15

16
17 18

Q Why don't you explain tha t to me.

A I f they started dur ing that time
period, example of five days, they would not
receive a $500 draw, they would receive a draw

19

20 21
22

equal to that prorated time. And the same would,
in fact, happen if they were terminated, if they
left in the middle of a pay period.

23
24 25

Q Was that a policy that was applied on
a nationwide basis, the prorating of the draw?

A It would be a guideline, yes.
SHUGART & BISHOP

Case 1:03-cv-02485-MSK-PAC

Document 345-15

Filed 02/16/2006

Page 4 of 7

1 Q Besides those exceptions, like the
2 first few weeks of employment and the last few
3 weeks of employment, was it the plan, part of the

Page 17

4 compensation plan, that they received a $500 draw

5 every two weeks or every pay period?

7 Q And that was a draw against their
8 commissions, right?

6 A Yes.

10 Q Would it be fair to say that this
11 draw against commissions was basically a loan to
12 the loa n 0 f f ice run t i 1 the y ma de some c ommi s s i on s ,

9 A Yes.

13 and then it was taken back by the company at that

14 time?

15 A No.

16 Q Explain to me why not. 1 7 A It' s not a loa n . It was a d raw. An
18 example would be when a loan officer starts, for
19 the first 30 days they are on a nonrecoverable

20 draw. So that money never does -- is never
21 collected back.

22 Q That hasn't been the policy, though,
23 since July of 2002, correct? That was implemented

24 sometime in 2003?

25 A The policy in 2002 to current,
SHUGART & BISHOP

Case 1:03-cv-02485-MSK-PAC

Document 345-15

Filed 02/16/2006

Page 5 of 7

Page 18

1 sometime, it was during that time period, it would

2 have been a 90-day nonrecoverable draw, it could 3 have been a 60-day nonrecoverable day, but it
4 currently is a 30-day nonrecoverable draw for new

5 hires.
6
Q

And nonrecoverable draw means they

7 receive the $500 every pay period, and it is never 8 at any point during their employment taken back by

10 A Correct.
14 days?
15
A

9 the company?

11 Q Even if they work there for say six
12 months, it is not accumulated and taken back after

13 they've been there more than the 30 days or 90
During whatever the time period that

16 they worked, they received the compensation that

17 was in the plan at that time.
18
Q

What I'm trying to understand is when

19 you call ita nonrecoverable draw, does the company
20 recover it if the person stays beyond that period

21 for which it is nonrecoverable?
22
Say, for example, for 90 days it is

23

nonrecoverable.

If the person stays longer than 90

24 days, does the company keep track of those draws

25 during the 90 days and try to recover them later
SHUGART & BISHOP

Case 1:03-cv-02485-MSK-PAC

Document 345-15

Filed 02/16/2006

Page 6 of 7

Page 22

pay period
mon th .
Q

A
Q

A
Q

paid?
A

SHUGART & BISHOP

Case 1:03-cv-02485-MSK-PAC

Document 345-15

Filed 02/16/2006

Page 7 of 7

Page 23

1 if they are on that particular cycle.

2 Q Oh, I see. How is it determined
3 which cycle they are on?

4 A It depends -- different branch of
5 offices as well -- you know, I'm not sure which

6 dates the corporate office is. But we divided it
7 down because there were so many employees to get

8 the work done so...

9 Q i see. Taking the example of the
10 employees that are paid on the 5th and 20th of the
11 every month, say they are paid on the 5th, what

12 time frame does that cover?

13 A Okay. The first cycle that they
14 would be paid on in a month would be the 20th, and 15 then the 5th would be the second cycle. So if the
16 question is what does that time frame represent for

1 7 the 5 th --

19 A it would be the time frame after
20 the 20th through the 5th.

18 Q Which dates are they, yeah.

21 Q Have there been situations where an
22 employee has left say, for example, on the 30th of
23 the month, and they are on the cycle where they are

24 supposed to be paid on the 5th and the 20th, say
25 they left on the 30th of every month, would they be

SHUGART & BISHOP