Suit Says Technology Solutions Companies Evade OT Obligations

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Cognizant Technology Solutions U.S. Corporation and Cognizant Technology Solutions Corporation are facing a proposed class action lawsuit alleging they violated state and federal labor laws. According to the suit, the plaintiff – an immigrant employed by the defendants as a computer analyst under the federal H1B visa program – and similarly situated salaried employees were, prior to August 16, 2012, misclassified as exempt from overtime wages. After this date, however, the lawsuit claims the company, following a "meritorious" allegation concerning possible improper worker classification, changed its pay practices and thusly classified proposed class members as non-exempt hourly employees entitled to overtime wages.

Despite this policy change, the lawsuit argues the defendants attempted to skirt their overtime obligations by drastically reducing employees’ base rates of pay, knowing they “would never earn the entire amount of the agreed-upon salary.” To “make up” for this decrease in pay, the companies allegedly provided employees with a “True Up” payment each week that increased their wages to the salary they received before the August 2012 classification switch. The suit says this arbitrary payment varied each week and was unrelated to the amount of hours worked. According to the complaint, “the True Up payment was an artifice for evading wage and hour laws” and allowed the defendants to deny employees overtime wages and continue paying them based on a fixed salary regardless of how many hours they worked.

"The paystubs of [the plaintiff] and similarly situated employees did not correctly reflect the gross wages for work earned, the net wages earned, the total hours worked, the rate of compensation paid, the basis of compensation, or the identity of the legal entity that employed [the proposed class]," the lawsuit reads.

Even worse, the suit notes that many of the proposed class members are immigrants, a "vulnerable population" toward whom the defendants’ allegedly directed their behavior. According to the complaint, the defendants’ conduct “violates the spirit of H1B visa rules by using manipulation of immigrants’ labor rights to lower wages for that vulnerable group while also depressing wages and job opportunity for U.S. Citizens by negatively impacting the employment marketplace.”