WASHINGTON (AP) - The federal Department of Housing and Urban Development has agreed to pay $24 million to current and former employees who were not compensated properly under the Fair Labor Standards Act.

The payment to an estimated 7,000 people is part of a settlement the department has agreed to in an effort to settle a class action and grievance related to overtime exemptions and pay filed by trade unions.

Arbitrator Sean Rogers approved and signed the agreement Monday.

The grievance was filed in 2003 by Carolyn Federoff, who leads the American Federation of Government Employees Council 222 in Boston.

She alleged that employees were misclassified as exempt under the Fair Labor Standards Act. This denied them pay for overtime hours that were worked, a choice of compensatory time off and pay for travel time and "off the clock" work.