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Suit Contends IBM Owes Workers Overtime Pay

January 25, 2006|From Bloomberg News

IBM Corp. was accused in a lawsuit of improperly denying overtime pay to tens of thousands of workers who install and maintain computers.

A complaint filed in federal court in San Francisco by one former and two current employees claims the world's biggest computer services company falsely classified workers as exempt from overtime pay, said James Finberg, an attorney for the workers.

The complaint asks for back pay and damages for thousands of U.S. employees who had similar experiences.

Technology companies including Oracle Corp., Electronic Arts Inc. and Hewlett-Packard Co. have been sued by employees claiming they weren't paid for overtime work. Oracle last year settled a sales employees' suit for $12 million.

"We believe that those tens of thousands of workers have worked tens of thousands, perhaps millions, of unpaid overtime hours," Finberg, of law firm Lieff Cabraser Heimann & Bernstein in San Francisco, said at a news conference.

IBM spokesman John Bukovinsky didn't immediately respond to a message seeking comment.

IBM, based in Armonk, N.Y., required technicians who install and maintain hardware and software for customers to work weekends, evenings and through their lunch hours without being paid, the complaint said.

Systems administrators, network technicians and other technical staffers were denied overtime pay, according to the complaint, which seeks compensation going back six years for some workers.

Employees who work more than 40 hours a week are generally entitled to overtime pay. Labor laws exempt most executives, administrative staffers and highly skilled software engineers who exercise "discretion and independent judgment" in their jobs. Computer maintenance and installation workers who are following company procedures and aren't in decision-making roles aren't exempt, lawyers for the IBM workers said.

The plaintiffs are two current IBM workers in San Francisco and one former worker in New York. The complaint says IBM violated federal, California and New York labor laws.

The employees make an average of $40,000 to $60,000 a year, their lawyers said.

Shares of IBM fell 56 cents to $80.85 on Tuesday.

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