IBM has agreed to pay $65 million to settle a class action lawsuit accusing the company of misclassifying workers as exempt from overtime.
The lawsuit was filed in federal district court in the Northern District of California in January 2006. The settlement is still subject to final approval by the court.
In the lawsuit, current and former IBM employees within IBM's technical services professional and information technology specialist job categories alleged that the company misclassified them as exempt from overtime under the Fair Labor Standards Act and certain state laws and that the company should have paid them overtime compensation.
In agreeing to settle the lawsuit, the company denied the allegations, saying litigation would have been lengthy, burdensome, and expensive. IBM says that its pay practices are fair and comply with all applicable laws and regulations.