Debi Mishra, an Employee of Cognizant working in California had filed a lawsuit on 25th August 2017, Debi Mishra v. Cognizant Technology Solutions U.S. Corporation before the United States District Court Eastern District of California alleging that Cognizant had underpaid its employees against overtime.
According to the employees, they were a part of the quality engineering & assurance (QE&A) team. In 2012, the employees of the team received Letters from Cognizant stating that they would be eligible for overtime. Further, in accordance to the contents of the said Letter, the Plaintiff in particular like various other employees was guaranteed an annual income of no less than $62,100 through various components such as additional bonus etc. However as per the plaintiff, the actual payment received was much lower.
Before the court, the Plaintiff filed report of an Expert Forensic Economist which was based on the analysis of the data available with the employee in this regard. As per the Report of the Expert Forensic Economist, the total damages for all employees, in view of reduced overtime wages was to the tune of $ 11,219,891. However the Company refused to acknowledge the calculation stating that the employees in reality did not work overtime but merely recorded overtime to obtain greater pay cheques.
Nevertheless in 2016, the parties first participated in a private mediation proceeding but to no resolution. Now with the second round of mediation, the parties agreed to terms of settlement vide a Class-action Settlement Agreement. As per the terms of the said Class-action Settlement Agreement, Cognizant has agreed to pay a sum of 5.7 million i.e. Rupees 43 Crore which shall be equally divided among the class of employees. Apart from being a heavy settlement liability even for an IT Giant like Cognizant, it is also extremely critical as far as fate of matters universally with regard overtime wages is concerned.
Amrit Tarafdar, Advocate | Abhay Nevagi & Associates