TCS settles California wage dispute for $30 million

Tata Consultancy Services Ltd (TCS), India's largest software services company, has agreed to pay $29.8 million to settle a wage dispute in the US, filed by employees sent from India.

The complaint was filed by non-US employees Gopi Vedachalam and Kangana Beri, who were sent to the US to work on projects. The employees had alleged that TCS had deducted federal and state taxes from their pay after forcing them to sign documents.

"TCS believes that it always acted appropriately notwithstanding the allegations in this case. 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,'' a company spokesperson said.

The settlement also includes Tata Sons, the holding company of all Tata group firms.

In June 2006 and later in April 2007, Tata America International Corp, TCS and Tata Sons filed motion to dismiss the case, stating it should be arbitrated in India rather than the U.S.

Terms of the settlement were described in filing on 21 February with the US District Judge Claudia Wilken in Oakland, California. The case was certified as a class, or group, lawsuit for all non-US citizens employed by the company in California from 14 February 2002 to 30 June 2005.