Compliance January 12, 2001

Microsoft Settles "Permatemp" Case for $97 Million

December 13, 2000 (PLANSPONSOR.com) - Microsoft has settled the "permatemp" class-action lawsuit, filed in 1992 by temporary workers of the software giant, for $96.9 million.
Reported by

Microsoft hired the so-called “permatemps” through “temp” agencies, allegedly so that the software giant could avoid paying pensions, health care and stock options that they would have been entitled to as full time workers.

According to a press release from Bendich Stobaugh & Strong, the law firm that filed the suit, the settlement includes all compensation to class members, attorneys’ fees and litigation expenses.

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Settlement Basis

The law firm estimates that between 8,000 and 12,000 class members will receive payment under the settlement based on:

  • when they worked
  • the duration of their status as “permatemps”
  • the total number of workers who file claims

The settlement acknowledged – and praised – Microsoft for recent policy changes, noting that it has hired some 3,000 former permatemps as workers with full benefits since 1997. Additionally, in July Microsoft adopted new policies to limit the length of temporary worker assignments (12 months, with a 100-day gap before rehiring the same worker).

Microsoft employs 42,000 workers worldwide.

– Nevin Adams                                         editors@plansponsor.com

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