Judge approves settlement in massive back pay case

A nearly 20-year-old special rates back pay case involving hundreds of thousands of current and former federal employees was resolved Friday when a federal judge gave final approval to a $173.5 million settlement.

Judge Nancy Firestone approved the settlement after spending the last month reviewing comments from the participants about how to divide up the money. According to National Treasury Employees Union President Colleen Kelley, the 212,000 employees affected by the case will get information packets in the next few months telling them how much they are owed and how to claim the money.

"Clearly, achieving final approval of the settlement is the goal we've been working toward for the past year," Kelley said in a statement released Friday. "After all this effort, it will be very gratifying to see this money paid to those who deserve it."

The settlement will reimburse thousands of federal workers who were denied certain salary increases from 1982 to 1988 because of an Office of Personnel Management regulation that exempted special rate employees from annual pay adjustments to the General Schedule. These employees were paid at higher levels than other workers because they worked in occupations that were difficult to fill because of job duties or location.

NTEU challenged the OPM regulation in a 1983 class action lawsuit. Four years later, a district court ruled the regulation was illegal. OPM and NTEU spent another 11 years arguing over how to settle the case. In 1998, the U.S. Court of Appeals ruled the government owed affected employees back pay and sent the case back to the lower court to determine the level of compensation. In January of this year, OPM and NTEU reached a settlement, which was sent to the Court of Federal Claims for approval.

While all special rate workers employed from 1982 to 1988 were included in the suit, employees who were properly compensated during that period will not benefit from the settlement. At least 43,000 clerical workers in the Washington area will be compensated under the settlement, along with various engineers, medical workers and security employees across the country.

Survivors of deceased employees can make claims, as well as employees who think they are entitled to back pay but were not members of the class action suit.

For more information about the special rates back pay case, visit http://www.specialratessettlement.com or call NTEU's special hot line at 800-750-3406.