EA to Pay $15.6 Million to Settle Overtime Case
Video game publisher Electronic Arts Inc. said Wednesday that it would pay $15.6 million to settle claims that it required graphic artists to work long hours and weekends without overtime pay, resolving the first of several cases highlighting working conditions in the fast-growing industry.
The world’s largest independent game publisher also agreed to reclassify about 200 entry-level artists as eligible for overtime, said Jose Martin, head of human resources for EA Global Studios. In May, the company reclassified about 240 jobs spread over its corporate, studio and marketing divisions as eligible for overtime.
It isn’t clear how much individual artists would collect, but the lawsuit -- filed in July 2004 in San Mateo County Superior Court -- estimated that “several hundred” workers could be eligible for overtime wages.
Lawyers representing the plaintiffs declined to comment on the settlement but said that EA’s practices were not unique. They said they had filed similar suits against Redwood City, Calif.-based EA on behalf of one of its computer programmers and against Foster City, Calif.-based Sony Computer Entertainment America Inc. for a former artist there.
“There does seem to be a common practice throughout the video game industry ... [of companies classifying] employees as exempt from the overtime laws,” said Miranda Kolbe, a San Francisco attorney for the EA artists.
The lawsuit alleged the employees in EA’s California studios regularly worked more than eight hours a day or 40 hours a week, clocking in on weekends and occasionally on holidays without compensation.
Industrywide, experienced game artists make an average of about $65,000 a year.
Under the agreement, the artists’ claims will be dismissed without EA acknowledging wrongdoing, an EA spokeswoman said.
The $15.6 million covers the workers’ claims, their attorneys’ fees and administrative costs. The settlement is expected to be submitted to a judge in San Mateo County this week.
The settlement comes at a crucial time for the video game industry, which is bracing for a new wave of game consoles from Microsoft Corp., Sony Corp. and Nintendo Co. that, in turn, are expected to trigger a flood of new titles by publishers such as EA.
The company, best known for its John Madden line of football video games, also was caught up in a larger controversy last fall over working conditions in the video game industry. The dust-up was sparked by a woman using the pseudonym ea_spouse who posted a 2,000-word essay on the Internet lamenting the long hours her fiance worked as an EA video game programmer.
Martin said his company had spent the last year trying to smooth out production schedules, particularly around the crunch periods leading up to the final release of a game. EA, for example, is bolstering its project management ranks to ensure projects are better supervised.
Martin said the improvements were in the early stages of implementation and declined to declare an end to the hectic crunch periods. The changes, he added, were fueled in part by results from an employee survey launched in January among EA’s 6,500 workers, which garnered an 83% participation rate.
“We want staff to help us solve these complex challenges so we can deliver great content for next-generation gaming systems,” Martin said.