ICT Lowers Estimate of Class-Action Cost

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Teleservices provider ICT Group yesterday lowered its estimated costs for an ongoing labor class-action suit involving a West Virginia call center by $5 million.


ICT, Newton, PA, said it lowered the estimate, previously $12.58 million, in response to recent Supreme Court rulings that may limit the amount of damages for which it may be liable in the case.


In April, a circuit judge in Berkeley County, WV, ruled that ICT owed damages to former employees for failure to pay for transition time, short breaks and wages as required by state law.


ICT has said it is appealing the ruling.


Despite the lower anticipated costs from the lawsuit, ICT reduced its expected revenue for the second quarter of 2003 to $70.5 million, down from $74 million to $78 million. The company said the weak economy, new federal telemarketing regulations, the weakness of the U.S. dollar against foreign currencies and costs for ramping up new customer-care contracts affected its outlook.


However, ICT upgraded its 2003 second-half revenue outlook to between $160 million and $170 million, citing the implementation of six new and expanded customer-care agreements awarded in the first half of 2003.


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