The Justice Department is facing a revolt by some of its own lawyers, who claim they have illegally been denied overtime pay. In addition to being the subject of a class action lawsuit, the dispute has become an issue in the appropriations process in Congress.

Earlier this week, Judge Robert Hodges Jr. of the U.S. Court of Federal Claims gave final approval to a notification to be sent by Sept. 3 to more than 12,000 present and former Justice Department lawyers inviting them to join in a class action lawsuit against the department that seeks more than $500 million in damages for uncompensated overtime work.

The lawsuit, filed in November on behalf of 180 present and former Justice Department lawyers, alleges that in refusing to pay its lawyers for overtime work, the department charged with enforcing the nation's laws has knowingly violated the 1945 Federal Employees Pay Act, which requires overtime compensation for all federal employees who work more than an eight-hour day or a 40-hour week.

The dispute spilled over into the appropriations process this summer when a Senate Appropriations subcommittee, acting with the Justice Department's approval, added a provision to the department's appropriation for the next fiscal year that would prohibit its funds from being used for overtime pay. But at the urging of House Judiciary Committee Chairman Henry J. Hyde (R-Ill.) and other lawmakers, the House did not include this provision in its version of the bill. The issue will have to be decided in a conference committee.

Gearing up for that battle, eight lawyers from the firm of Williams & Connolly, which is representing the Justice Department lawyers in the lawsuit, recently registered as lobbyists with Congress for the purpose of fighting the inclusion of the Senate language in the final appropriations measure.

At stake in the lawsuit is what the Justice Department estimates could be $40 million a year or more in overtime expenses. The department insists that its lawyers are "professionals" who accept the fact that they will often work more than 40 hours a week to accomplish their tasks.

The lawsuit alleges that the Justice Department maintains "two sets of hourly time records," one that shows its lawyers routinely working five eight-hour days a week, and another that records the actual time they worked--often much more than 40 hours a week. The second set of time records is used to justify the higher budget requests sent to Congress and in setting awards for attorneys' fees in litigation with private parties, the lawsuit contends.

A Justice Department official responded that the more detailed time records are a valuable "management tool" that helps the department allocate resources among its various divisions and the 94 U.S. attorneys' offices around the country.

According to documents obtained by lawyers for the plaintiffs, the Justice Department ranks U.S. attorneys' offices according to how much overtime their lawyers record, and that the U.S. attorneys recognize that these rankings can affect what resources they are given by Washington.

In a 1992 memo to his assistants, Byron G. Cudmore, then first assistant U.S. attorney in Springfield, Ill., lamented that "we have slipped from 41 to 44 in our national ranking."

"If we can move to 50.65 hours per Assistant United States Attorney per week we will leap into 15th place in the national rankings," he said. "I have learned that these rankings do matter as they relate to additional personnel resources that we may be able to receive. Therefore, a little extra overtime by each of us benefits all of us."

Other internal Justice Department records obtained in the case suggest that senior department officials have recognized since at least 1980 that the no-overtime-pay policy was vulnerable to a court challenge. In a prophetic memo dated 16 days before the lawsuit was filed, Fran M. Allegra, then a deputy associate attorney general, wrote, "I believe that it is problematic (some might use the term unconscionable) for the department to continue to not pay its attorneys overtime knowing full well that the overtime statute applies."

"In any event," Allegra added, "if the department continues to ignore this problem, sooner or later an intrepid attorney will develop a class action on this issue and major problems will result."

Robert A. Van Kirk, one of the attorneys representing the Justice Department lawyers, said his clients share "a real sense of disappointment that the department would be less than forthright about its obligations under the [federal pay] statute. They are charged day in and day out with enforcing the laws of the nation. They would expect their employer would do likewise."

The Justice Department said it would have no comment on the lawsuit. But a department official who is familiar with the case defended the long-standing no-overtime policy.

"We'd all like to make more money," he said. "On the other hand, there really would be a marked cultural change if Justice lawyers become [hourly] employees. I don't think that is what our lawyers want. People come here for the work--and it is an exciting place to work."