Free Brief in Support of Motion - District Court of Colorado - Colorado

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

Document 339-17

Filed 01/31/2006

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DUANE MCCLAIN and ALESIA MILES
VS

HEARTLAND HOME FINANCE

DEPOSITION OF
DONALD

FLYN

AUGUST 17,2005

CONDENSED TRASCRIPT AND CONCORDANCE

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

Document 339-17
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Filed 01/31/2006

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never seen any overtime hours recorded on time sheets?
A Q

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That's correct.

4 Is there any other circumstance 5 as part of the compensation plan, was it? 5 underwhich you've reviewed loan offcer time sheets' 6 A It was not a standard practice to I can't recall any other time that 6 A 7 give loans and advances at that time. employees' time sheets. 7 I've reviewed The compensation plan that applied on 8 Moving on to -- I'll ask you more 8 Q Q 9 a nationwide basis was that they just received 9 about the time sheets later. Moving on to method 10 commissions, right? 10 of compensation, at your last deposition, you 11 A Yes. 11 testified that prior to July of 2002 the loan So there were situations where a loan 12 12 offcers were paid strictly commissions and that Q 13 offcer didn't earn any commissions in a certain 13 there was no draw; is that correct? 14 pay period and received no paycheck, correct? 14 A I believe that was my testimony, yes. 15 A Yes. 15 Q So would you agree that prior to July 16 And, in fact, the Departent of Labor 16 of 2002 if a loan offcer earned no commissions in Q 17 investigated Heartland Home Finance for that time 17 a pay period, they would not be earning minimum 18 period when employees only received commissions. 18 wage; right? the 19 They investigated the minimum wage component of MR. CARR: Object to the form of 19 20 that, right? 20 question. 21 I believe so, but Tom Beck would A 21 You are free to answer if you can.

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BY MS. FISHER: But they didn't receive -- it wasn't Q the compensation plan that loan offcers at that time were receiving any sort of loans or advances

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THE WITNSS: If

they didn't receive

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

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probably be -- have more information on that. Okay. After July of2002, and I Q
believe in your deposition you testified it was July of 2002 through February 1st of2004, correct

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me if I'm wrong, you stated that there was -- the loan officers nationwide were paid a draw against commissions; is that correct? A Since July of2002 loan offcers get

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-- have received draws.
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So it didn't end February 1,2004 or

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A It's not a loan. It was a draw. An example would be when a loan offcer starts, for the first 30 days they are on a nonrecoverable receive a $500 draw, they would receive a draw 20 equal to that prorated time. And the same would, 20 draw. So that money never does -- is never

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anything. That's been the policy since July of 2002 to date, correct? A Yes. And it's my understanding that under Q that policy, every loan offcer on a nationwide basis receives a $500 draw per pay period; is that correct? There would be situations where they A would not. Why don't you explain that to me. Q
A If they started during that time period, example of five days, they would not

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Besides those exceptions, like the first few weeks of employment and the last few weeks of employment, was it the plan, part of the compensation plan, that they received a $500 draw every two weeks or every pay period? Yes. A And that was a draw against their Q commissions, right? Yes. A Would it be fair to say that this Q draw against commissions was basically a loan to the loan offcer until they made some commissions, and then it was taken back by the company at that time? A No. Explain to me why not. Q
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in fact, happen if they were terminated, if they 22 left in the middle of a pay period. 23 Was that a policy that was applied on Q basis, the prorating of the draw? 24 a nationwide 25 A It would be a guideline, yes.
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sincè July of2002, correct? That was implemented sometime in 2003? A The policy in 2002 to current,

collected back. That hasn't been the policy, though, Q

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