Failure to review classifications for two decades strengthens willfulness finding
A federal judge ruled that TEKsystems wrongly classified its recruiters as exempt from overtime, finding they sell staffing services rather than manage company operations.
On Wednesday, February 11, 2026, a Pennsylvania federal court handed down a decision that should make every HR director take a hard look at their own exemption classifications. The ruling against TEKsystems, one of the nation's largest staffing firms, centered on a question that keeps compliance officers up at night: when does a professional employee's work cross the line from administrative to production?
Judge William S. Stickman IV didn't mince words. He found that recruiters at TEKsystems spend their days doing exactly what the company sells to clients: finding people for jobs. That makes them producers, not administrators, and entitled to overtime pay.
The case started in April 2021 when Michael Thomas and six colleagues sued on behalf of themselves and other recruiters employed by the company over a three-year period. TEKsystems, a subsidiary of staffing giant Allegis Group, had classified these recruiters as exempt administrative employees who weren't eligible for overtime under the Fair Labor Standards Act.
The company argued its recruiters exercised significant independent judgment by sourcing candidates, evaluating qualifications, and partnering with sales teams to understand client needs. TEKsystems painted a...
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