Provident Financial Holdings Enters Settlement Agreement to Resolve Labor Disputes

Provident Financial Holdings Inc. (NASDAQ: PROV) disclosed in its latest SEC Form 8-K filing that it reached a memorandum of understanding, following mediation, to settle pending litigation related to wage and hour claims brought by former employees of its wholly owned subsidiary, Provident Savings Bank, F.S.B.

The mediation, held on February 20, 2025, involved former employees Cheryl Jones and Jennifer Williams along with their legal counsel and representatives for the bank. Ms. Jones had initially filed a lawsuit in May 2023 in Placer County Superior Court alleging misclassification as a non-exempt employee, missed meal and rest breaks, and inaccurate wage statements. In a separate matter, Ms. Williams, a former employee whose claims also centered around unpaid wages, missed breaks, and other alleged labor violations under California’s Private Attorneys General Act (PAGA), had initially pursued a class action complaint. After dismissals and subsequent legal maneuvers, Ms. Williams initiated a representative action in San Bernardino County in February 2024. The issues were later consolidated for mediation.

Under the terms of the settlement in principle, Provident Financial will make an aggregate payment of $231,600. This payment is designed to fully release the bank—and related parties—from any and all individual claims and PAGA claims arising from the periods specified in the settlement, which cover non-exempt employees from November 16, 2022, onward and exempt loan officers from February 16, 2022, onward. The settlement amount includes all settlement funds, service payments, administrative expenses, and legal fees. Additionally, any further costs related to the bank’s defense of these matters will be borne by the bank.

Provident Financial noted that due to uncertainties related to the litigation, no litigation reserve was established, resulting in the entire settlement expense being recognized in the third quarter of fiscal 2025. The agreement resolves the dispute without any admission of liability or wrongdoing on the part of the bank. The settlement remains subject to completion of the memorandum of understanding, execution of the finalized settlement agreement, court approval, and other customary conditions.

The filing reflects Provident Financial’s efforts to manage potential labor-related liabilities through negotiated settlements and underscores the broader trend in the financial services sector of resolving employment-related disputes outside of prolonged litigation.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Provident Financial’s 8K filing here.

About Provident Financial

Provident Financial Holdings, Inc operates as the holding company for Provident Savings Bank, F.S.B. that provides community banking services to consumers and small to mid-sized businesses in the Inland Empire region of Southern California. The company's deposit products include checking, savings, and money market accounts, as well as time deposits; and loan portfolio consists of single-family, multi-family, commercial real estate, construction, mortgage, commercial business, and consumer loans.