The action alleges that Kodak has shorted the paychecks of thousands of Rochester, New York, workers for years through flawed policies on overtime compensation. Kodak allegedly routinely allows staffers who work more than 40 hours a week to choose to be paid either in money--at 1.5 times their hourly wage rate--or in compensatory time off from their jobs. That policy, which extends to a host of both blue- and white-collar employees in Kodak's Rochester work force, is allegedly illegal under state and federal law. Lawyers for the employees are sending notices of the case to about 30,000 present and former Kodak workers who have been eligible for overtime.

For some years, Kodak allegedly forced retired or downsized employees to sign an agreement that prohibited them from suing the company for back overtime under state and federal law. Under those agreements, employees who sued would be required to pay back their severance benefits. In July 2003 the court certified the class and invalidated that clause, giving the action a breath of life. The ruling had the effect of alleviating the workers' fear of financial reprisal, so more can afford to consider joining the class. Kodak has appealed the ruling.

Overtime pay is currently a divisive political issue nationwide. In September 2003 the U.S. Senate is expected to vote on a bill that could clear the way for a drastic overhaul of overtime regulations nationwide. The U.S. Department of Labor wants to alter eligibility standards, a move it says will allow about 700,000 new employees to qualify for overtime annually. Labor activists, however, contend that the changes will actually strip as many as eight million people of their ability to collect time-and-a-half. Meanwhile, Congress is also considering a bill that would legalize overtime pay in the form of compensatory time for the private sector.