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Health care software maker Epic Systems would pay $5.4 million to settle a lawsuit by former workers who sued the company claiming that they were not paid overtime wages to which they were entitled, under a settlement filed in court Friday.

The proposed settlement, filed in U.S. District Court in Madison, applies to quality assurance employees of the Verona-based company, who sued in December over unpaid overtime wages.

Since the lawsuit was filed, originally naming one former worker as plaintiff, 44 others have joined.

After the two sides agreed to conditionally certify the class, just under 1,000 current and former quality assurance workers were mailed notification of the class action in May.

Under the agreement, Epic does not admit to the allegations made by the former workers. Both sides are settling the lawsuit to avoid further expense and the risk of the case’s uncertainty, the agreement states.

The lawsuit alleged that quality assurance employees were improperly classified by Epic as being exempt from overtime wages. That was a point on which there was no agreement, according to a brief that outlines the procedure leading to the settlement.

Epic maintained, according to the brief, that QA workers are exempt either as administrative or computer employees. Lawyers for the QA workers maintained that the job duties of the QA workers don’t fit either of those classifications.

“The parties have divergent views regarding plaintiff’s assertions in his complaint, but were able to work toward a compromise in this matter,” wrote Noah Finkel, a lawyer for Epic, in a declaration supporting preliminary approval of the settlement.

The case is assigned to U.S. District Judge Barbara Crabb.

Under the agreement, members of the class of QA workers won’t have to file claims, but will receive payments from the $5.4 million settlement fund unless they exclude themselves. Lawyers for the plaintiffs will be paid from the settlement fund.

Any money left in the fund — from workers who exclude themselves from payments or those who don’t cash their settlement checks — will be donated to Madison-based Access Community Health Centers, which operates clinics in Dane and Iowa counties.

“The settlement provides all participating settlement class members a substantial benefit in light of the risk of recovery,” wrote William Parsons, a lawyer for the plaintiffs, in a declaration supporting approval of the agreement. Parsons wrote that before attorney fees, all will receive compensation for hours they worked based on actual time log data, plus an average of 3.7 hours per week to represent work time not captured by records.


Editor's note: This story has been updated to correct the description of Access Community Health Centers.

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Ed Treleven is the courts reporter for the Wisconsin State Journal.