IBM Hit With Second Employee Overtime Lawsuit - InformationWeek

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IBM Hit With Second Employee Overtime Lawsuit

Three IBM salesmen claim they regularly worked more than 40 hours per week, but were never paid overtime and also did not receive mandatory rest and meal breaks.

IBM has been hit with a second class action lawsuit alleging that the computer maker failed to pay legally required overtime to its sales workers.

In the complaint, three IBM salesmen claim they regularly worked more than 40 hours per week as well as daily shifts exceeding eight hours, but were never paid overtime and also did not receive mandatory rest and meal breaks.

"Sales representatives were paid principally on a salary basis, receiving commissions on their sales, irrespective of the hours actually worked, and were unlawfully classified as exempt from overtime compensation," the suit alleges.

The action was filed earlier this month in U.S. District Court for Eastern California by IBM sales reps John Bennet, Bill Graham, and Peter Stanger. It was not immediately clear whether any of the men are still employed at the company.

At issue is whether the workers were exempt from California's overtime rules and other benefit entitlements by virtue of their job functions. In general, white-collar executives and managers are not entitled to overtime. The plaintiffs maintain that IBM sales specialists aren't managers and should not be classified as exempt.

In May, former IBM sales rep Tom Chau also filed suit against IBM in California, complaining that he too should have been paid overtime for working hours in excess of the normal work week. Chau is seeking statewide class action status for his case. In a court document, IBM said it could be liable for back pay exceeding $5 million if Chau prevails.

Bennet, Graham and Stanger are seeking statewide and national class action status for their case. They're asking the court to order IBM to create a fund from which to compensate workers owed back pay.

In response to the first case, IBM officials have said that the argument that IBM misclassified sales workers lacks merit and that the company will "vigorously" defend itself in court.

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