IBM Agrees to Resolve Claims of Rosenburg, et al. v. IBM

IBM (NYSE: IBM) announced that it has agreed to resolve all claims in Rosenburg, et al. v. IBM, Case No. C-06-0430, an overtime pay class action lawsuit filed in federal district court in the Northern District of California in January 2006.


This case focused on certain current and former IBM employees within IBM’s Technical Services Professional and Information Technology Specialist job categories, alleging, among other things, that those employees were classified as exempt from overtime under the Fair Labor Standards Act and certain state laws, and that they should have been classified as non-exempt and paid overtime compensation. Under the terms of the settlement, still subject to final approval by the Court, each qualified individual in these two job categories will be entitled to apply for a payment, in accordance with an agreed formula, in full and complete settlement of all claims in the case.

Litigation of this case would have been lengthy, burdensome and expensive, and IBM chose to resolve it, without admitting any wrongdoing or liability, for a total of $65 million. IBM had established a provision for the probable settlement of this case in the third quarter of this year.

IBM states that during its 90-year history as a major employer in the U.S., it has a long-standing and proven track record in accurately and appropriately paying many hundreds of thousands of employees. IBM continues to believe that its payment practices are fair and comply with all applicable laws and regulations.