Videogame publisher Electronic Arts Inc. said Oct. 5 it would pay $15.6 million to settle a class action lawsuit by computer graphic artists seeking overtime compensation.
SAN JOSE, Calif. (AP) -- Videogame publisher Electronic Arts Inc. said Oct. 5 it would pay $15.6 million to settle a class action lawsuit by computer graphic artists seeking overtime compensation.
The suit, filed in July 2004, alleged the company improperly classified the workers as exempt from overtime and sought unspecified damages.
Under the settlement, which must still be approved by a Superior Court judge, roughly 200 entry-level employees will be reclassified as eligible for overtime pay, said Trudy Miller, an Electronic Arts spokeswoman. They will be able to earn overtime, but will no longer receive stock options.
"We're moving on, and this is a milestone in what has been an ongoing look at how we work," Miller said.
Redwood City, Calif.-based EA, the world's largest videogame maker, was one of a number of game companies that came under fire in recent years for demanding grueling hours without paying its workers compensation. Until it adopted a new overtime policy earlier this year, EA, like many other high-tech companies, mostly offered stock options.
The new policy -- and now the settlement -- both reflect a trend throughout the technology industry of increasingly rewarding workers with cash instead of stock-option grants, which during the 1990s often translated into huge windfalls.
Still, the vast majority of EA's 6,500 employees remain exempt from overtime, Miller said.
Bob Schubert, a San Francisco attorney who represented the plaintiffs in the lawsuit, would not comment on the settlement. His law firm has another class action lawsuit filed on behalf of EA's engineers pending.
But generally, he said, "our view is that these are all production workers in the industry. They're like steel workers. They're at the first level of the pyramid and should be entitled to overtime pay."