By JARED WHITLEY
Storm clouds continue to hang over some U.S. markets. Four real estate titans have recently lost their Fortune 500 status. There are dire predictions specifically for the commercial real estate sector. Forbes summed up the housing market this week with, “Despite being well into the spring homebuying season, the housing market is still experiencing a winter chill.”
But for one company, the bad news is much worse.
Two lawsuits have been filed against Michigan-based United Wholesale Mortgage, with former underwriters accusing the company of a variety of misdeeds, including:
· Retaliation
· Hostile workplace environment
· Gender/sexual harassment
· Failure to pay minimum wages and overtime
This is the latest of a long list of accusations against the company. In April, Bloomberg ran a high-profile article detailing serious complaints from some 30 current and former employees of CEO Mat Ishbia’s company. Similar grievances are aired every day on the Pillar 7 subreddit, which is dedicated entirely to gripes about working conditions at the company.
Now, complaints on an online message board carry no legal weight, but lawsuits could – especially since the U.S. Equal Employment Opportunity Commission has granted both a right-to-sue letter.
The first suit is from plaintiff Kassandra Memmer, whom UWM hired as a conventional underwriter in September 2019. She quit her job in 2021 after the lender ended its COVID lockdown “work from home” policy. She had a doctor’s note prescribing a leave of absence to ensure both her health and her unborn child’s.
The second lawsuit is from Memmer’s partner, Jackson, who started working at UWM shortly before her. In it, he alleges he was fired due to an investigation into clearing conditions with appraisals while on paternity leave. Jackson lost his job in December 2021.
A variety of other complaints are included in the suits, including that UWM did not pay either Memmer their final bonuses and that a broker once told Kassandra in an email that she was “too pretty to be an underwriter and that he was going to tell her CEO Mat Ishbia to make her a model for the company.”
If true, the accusations are bad for everyone at the company, not just the victims, according to University of New Haven Professor Angeli Gianchandani.
“Harassment in the workplace has a detrimental impact on all employees, including lower productivity, worse morale, and more attrition,” said Gianchandani, who specializes in marketing and business ethics at New Haven’s Pompea College of Business. “Harassment at any level is not acceptable. It must never be overlooked or tolerated. The impacts are linked to unfavorable career progression, financial loss, psychological well-being, and physical health conditions.”
These are not the first lawsuits UWM has had to fend off regarding its behavior.
In 2021, CEO Mat Ishbia held a Facebook Live event where he declared a fatwa against brokers who partner with competitors Rocket Mortgage or Fairway Independent Mortgage Corp. Any broker who worked with them would be blacklisted from subsequent partnerships with UWM. That triggered fallout in the mortgage industry, with companies like America’s MoneyLine suing UWM for anti-competitive practices.
Ishbia was also involved in one of the most notorious scandals in the mortgage industry in the past decade. He was featured in a series of untrue, obscene, and misogynistic videos and comments from business ally Anthony Casa sent to leaders in the mortgage industry. Within weeks, Casa was forced to resign from his job as head of the Association of Independent Mortgage Experts. But Ishbia and UWM are apparently back in business with Casa yet again.
“A company’s reputation is an organization’s greatest currency,” Gianchandani continued. “Prioritizing a healthy work culture by being proactive, implementing a strong policy, and providing thorough harassment prevention training is critical. Whether it is a positive or negative reputation, it will compound. Set the tone by establishing the brand culture as it will be the lifeblood of your organization.”
None of that seems to deter Ishbia, who in a recent LinkedIn post proclaimed his commitment to doing what’s right for brokers, consumers, and other stakeholders in the home buying experience.