Tata Consultancy Settles Wage Dispute for $30 Million

Tata Consultancy Services Ltd. (TCS), Asia’s largest software-services provider, agreed to pay $29.8 million to settle a wage dispute in California with workers who were sent to work in the U.S. from India.

Terms of the settlement are described in a Feb. 21 filing with U.S. District Judge Claudia Wilken in Oakland, California. The judge in April certified the case as a class, or group, lawsuit for all non-U.S. citizens employed by Tata in California from Feb. 14, 2002, to June 30, 2005.

“This was an extraordinarily hard fought case and we are proud of the result for the employees,” Kelly M. Dermody, a lawyer for the workers, said in an e-mail.

The settlement also includes Tata Sons Ltd., the software maker’s closely held parent, whose businesses include India’s largest vehicle maker and steel producer.

Workers who weren’t U.S. citizens claimed Tata forced them to sign over their federal and state tax refunds to the company and wrongfully deducted Indian salaries from their U.S. compensation.

``TCS believes that it always acted appropriately notwithstanding the allegations in this case,'' Michael McCabe, a spokesman for Tata, said in an e-mail. ``The company has admitted no wrongdoing and none has been found by the court. It agreed to settle this matter to eliminate any on-going distraction to its associates and management.''

The case is Vedachalam v. Tata America International Corp., 06-cv-00963, U.S. District Court, Northern District of California (Oakland).

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net;

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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