San Francisco, CA, February 14, 2006
Ram Parsad
Lieff Cabraser Heimann & Bernstein,
LLP announced that Gopi Vedachalam, an employee of
Tata America International Corporation, filed today
a nationwide class action lawsuit in U.S. District
Court in San Francisco against Tata America International
Corporation, and its parent corporations Tata Consultancy
Services, Ltd., and Tata Sons, Ltd. (collectively
referred to as “Tata”). Among other allegations,
the suit charges that Tata has unjustly enriched itself
by requiring all of its non-U.S.-citizen employees
to endorse and sign over their federal and state tax
refund checks to Tata.
Tata is one of India's largest business conglomerates,
with revenues last fiscal year in excess of $17 billion.
The proposed class consists of thousands of current
non-U.S. citizen employees of Tata working in the
United States, plus former Tata employees dating back
to 2000.
“Tata’s employees from India and other countries
working legally in the United States, including thousands
of technical support personnel and project managers,
work hard to see that the American corporations they
support and Tata are profitable,” stated Lieff
Cabraser partner Steven M. Tindall. “These workers
are entitled to any amount of taxes they overpaid
federal and state tax agencies.”
Tindall noted that this case constitutes one of the
first class action lawsuits against a company engaged
in “reverse outsourcing,” bringing non-U.S.
citizens to the United States to work in U.S. corporations,
for violation of labor laws.
The complaint charges that most Tata employees in
the United States are non-U.S. citizens. These employees
are granted visas, which allow them to work and live
in the United States. Tata requires each employee
to sign an agreement which states that the employee’s
gross amount of compensation will be includable as
earnings in the United States and reported to the
U.S. Internal Revenue Service. The complaint alleges
that these employees are not paid the amount promised
them in these agreements.
The complaint alleges further that, at least until
July 2005, Tata required its non-U.S.-citizen employees
to sign power of attorney agreements delegating an
outside agency to calculate and submit each employee’s
tax return to state and federal authorities. Tata
then required its non-U.S.-citizen employees who received
tax refunds from state and federal tax authorities
to endorse the tax refund checks and send them back
to Tata.
Under California Labor Code Section 221, it is unlawful
“for any employer to collect or receive from
an employee any part of wages theretofore paid by
said employer to said employee.” The complaint
also charges that Tata’s conduct violates this
Code section as well as the common law forbidding
unjust enrichment and conversion.
From 2000 to 2003, plaintiff Gopi Vedachalam worked
in Hayward, California, as a Tata project manager
assigned to Target. Since 2003, he has worked as a
Tata project manager for 21st Century Insurance in
Woodland Hills, California. “I work hard for
Tata and the companies I have been assigned to. I
should receive the full wages Tata agreed to pay me,
as should all other Tata employees in America. I did
not hand over my tax refund checks voluntarily. I
tried to recover these wages through Tata’s internal
procedures, but I was met with either silence or refusal.”
Mr. Vedachalam is asking the federal court to certify
the case as a class action and issue an injunction
against Tata, preventing it from requiring its employees
to endorse their tax refund checks to the company
to the extent it is still doing so. The complaint
also seeks compensation and damages for current and
former employees who were not paid what they were
promised and who were deprived of their tax refunds.
