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                              EMPLOYMENT AGREEMENT

         THIS AGREEMENT, made as of August 24, 1998, by and between ICT GROUP,
INC., a Pennsylvania corporation (hereinafter called "Company"), and Vince
Paccapaniccia, an individual (hereinafter called "Employee").

                                   WITNESSETH

         Company wishes to employ Employee and Employee wishes to be employed by
the Company on the terms and conditions contained in this Agreement.

         NOW, THEREFORE, in consideration of the facts, mutual promises and
covenants contained herein and intending to be legally bound hereby, Company and
Employee agree as follows:

         1. Employment. Company hereby employs Employee as Sr. Vice President of
Finance and Administration and Chief Financial Officer and Employee hereby
accepts employment by Company for the period of time and upon the terms,
conditions and restrictions contained in this Agreement.

         2.       Duties and Responsibilities.

                  (a) Employee agrees to assume such duties and responsibilities
normally associated with the position indicated above, and as may be assigned to
Employee by the President of the Company from time to time. Employee shall
perform any other duties reasonably required by Company and, if requested by
Company, shall serve as an officer or director of Company without additional
compensation.

                  (b) Throughout the term of this Agreement, Employee shall
devote his entire working time, energy, skill and best efforts to the
performance of his duties hereunder in a manner which will faithfully and
diligently further the business and interest of Company. During the term of this
Agreement, Employee may not, directly or indirectly, do any work for any other
company.
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         3. Term. This Agreement shall be for a term of one (1) year, commencing
on August 24, 1998 and ending on August 23, 1999 unless sooner terminated as
hereinafter provided. Unless either party elects to terminate this Agreement at
the end of the original term by giving notice to the other at least 90 days
before the expiration of the then current term, this Agreement shall be deemed
to have been renewed for an additional term of one (1) year commencing on the
day after the expiration of the current term, unless sooner terminated as
hereinafter provided.

         4.       Compensation.

                  (a) For all of the service rendered by Employee to Company,
Employee shall receive a gross annual salary of $135,000.00, less taxes and
other deductions required by law, payable in reasonable periodic installments in
accordance with Company's regular payroll practices in effect from time to time.
Employee's base salary shall be reviewed by Company's Board of Directors
annually and may be adjusted by the Board of Directors in its sole discretion.

                  (b) In addition to Employee's base salary, Company may pay
Employee from time to time such bonuses or other additional compensation as
Company may determine in its sole discretion.

                  (c) Throughout the term of this Agreement, Employee shall be
eligible to participate in Company's insurance and other benefit plans and
programs subject to their terms, conditions and restrictions. Nothing herein
shall preclude Company from modifying or terminating any insurance or other
benefit plan or program.

                  (d) Employee shall accrue vacation pay at a rate of 1.5 days
per full month of employment. (e) Employee will not receive any remuneration or
any other benefit from any client or any other company or

individual in connection with any transaction in which Company is involved,
directly or indirectly. Nor will Employee assign or give any part of the
compensation which he receives from Company to any other employee, agent or
representative of Company, to any client or any of its employees, agents or
representatives, or to any other person or entity involved, directly or
indirectly, with Company.

         5. Expenses. Company will reimburse Employee for all reasonable
expenses incurred by Employee in connection with the performance of Employee's
duties hereunder upon receipt of vouchers therefor satisfactory to Company and
in accordance with Company's regular reimbursement procedures and practices in
effect from time to time.
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         6.       Post-Termination Payments.

                  (a) If Employee is terminated by Company pursuant to Paragraph
10 hereof, Company shall pay to Employee a monthly severance payment in an
amount equal to Employee's monthly salary at the time of termination for six (6)
months.

                  (b) Employee shall make reasonable efforts to obtain
replacement income (through employment and other sources) during the period in
which Employee receives post-termination payments from Company.

                  (c) Company's obligation to make post-termination payments
pursuant to Paragraph 6(a) shall be offset by any compensation earned by
Employee, as an employee, consultant, independent contractor or otherwise,
during the period in which Employee receives such post-termination payments.

                  (d) Company's obligations under Paragraph 6(a) shall cease in
the event Employee fails to make reasonable efforts to obtain replacement income
or in the event Employee breaches any of the restrictions or obligations set
forth in Paragraphs 12 and 13 of this Agreement.

         7. Inability. If Employee is unable to perform the essential functions
of his job, with or without reasonable accommodations, for whatever reason, for
a period of thirteen (13) consecutive weeks or for a cumulative period of
nineteen (19) weeks during any twelve-month period, Company shall have the right
to terminate Employee's employment, in which event Company shall have no further
obligations or liabilities hereunder after the date of such termination. The
termination of Employee's employment with Company pursuant to this Paragraph
shall not release Employee from Employee's obligations and restrictions under
Paragraphs 12 and 13 of this Agreement.

         8. Death. If Employee dies, Company shall have no further obligations
or liabilities to Employee's estate or legal representative or otherwise after
the date of his death.

         9. Discharge for Cause. Company may discharge Employee at any time for
"Cause", which shall include, but not be limited to: willful misconduct, fraud,
misappropriation, malfeasance, misfeasance, nonfeasance, embezzlement, gross
negligence, self-dealing, dishonesty, misrepresentation, conviction of a crime
of moral turpitude, or material violation by Employee of any Company policy or
provision of this Agreement. In the event Company terminates Employee's
employment for Cause, Company shall have no further obligations or liabilities
to Employee after the date of such discharge. The termination of Employee's
employment with Company pursuant to this Paragraph shall not release Employee
from Employee's obligations and restrictions under Paragraphs 12 and 13 of this
Agreement.

         10. Discharge Not for Cause. Notwithstanding any other provision of
this Agreement, Company may discharge Employee at any time without cause by
providing Employee with 30 days written notice, which notice Company may waive,
in whole or in part, in its sole discretion, by paying Employee for such 30
days. Upon termination of Employee pursuant to this Paragraph, Company shall be
obligated to provide Employee with post-termination payments in accordance with
Paragraph 6, but shall have no further obligations or liabilities to Employee
after the date of his termination. The termination of Employee's employment with
Company pursuant to this paragraph shall not release Employee from Employee's
obligations and restrictions under Paragraphs 12 and 13 of this Agreement.

         11. Termination by Employee. Employee may terminate his employment
under this Agreement at any time by providing Company with 30 days written
notice, which notice Company may waive, in whole or in part, in its sole
discretion, by paying Employee for such 30 days, Company shall have no further
obligations or liabilities to Employee after the date of his termination. The
termination of Employee's employment with Company pursuant to this Paragraph
shall not release Employee from Employee's obligations and restrictions under
Paragraphs 12 and 13 of this Agreement.
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         12.      Company Property.

                  (a) All advertising, sales, manufacturers' and other materials
or articles or information, including without limitation data processing
reports, client sales analyses, invoices, price lists or information, samples or
any other materials or data of any kind furnished to Employee by Company or
developed by Employee on behalf of Company or at Company's direction or for
Company's use or otherwise in connection with Employee's employment hereunder,
are and shall remain the sole and confidential property of Company.

                  (b) Immediately upon termination of Employee's employment,
whether by Employee or Company, whether during the term of this Agreement, upon
its expiration or subsequent to its expiration, Employee shall deliver to
Company, all Company property (for example, keys and credit cards) and all
documents, books, records, lists and other documents relating to Company's
business, regardless of where or by whom said writings were kept or prepared,
retaining no copies.

                  (c) In the event Employee receives notice from Company that
his employment is or will be terminated or Employee provides Company with notice
of his intent to resign, within five (5) days of receiving or providing such
notice, and thereafter as may be requested by Company, Employee shall provide
Company with a list of all clients and potential clients with whom he is working
and/or negotiating and a summary of the status of each matter with which he is
involved, directly or indirectly.

         13.      Restrictive Covenants, Trade Secrets, Etc.
                  (a) For a period of one (1) year after the  termination of his

employment with Company, for any reason whatsoever, whether during the term of
this Agreement, upon its expiration or subsequent to its expiration, whether by
Employee or Company, Employee shall not for his own benefit or for the benefit
of any third party, directly or indirectly, in any capacity, participate in any
of the following activities: (i) hire or do any business with any employee of
Company or otherwise induce or attempt to influence any employee of Company to
terminate his or her employment with Company; (ii) divert, solicit, or do any
business with any current, former (within two (2) years of the date of
termination), or potential (engaged in discussion with Company as of the date of
termination) client of Company; or (iii) cause or attempt to cause any current,
former, or potential client to refrain from doing business with Company. In
light of the fact that the clients of Company will be engaged in operations
nationwide and Company will be contacting potential customers for its clients
throughout the entire United States, the restrictions set forth in this
Paragraph 13 (a) shall apply throughout the entire United States.
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                  (b) During the term of this Agreement and at all times
thereafter, Employee shall not use for his personal benefit, or disclose,
communicate or divulge to, or use for the direct or indirect benefit of any
person, firm, association or company other than Company, any material referred
to in Paragraph 12 above or any information regarding the business methods,
business policies, procedures, techniques, research or development projects or
results, trade secrets, or other knowledge or processes of or developed by
Company or any names and addresses of clients or customers or any data on or
relating to past, present or prospective clients or customers or any other
confidential information relating to or dealing with the business operations or
activities of Company, made known to Employee or learned or acquired by Employee
while in the employ of Company.

                  (c) Any and all writing, inventions, improvements, processes,
procedures and/or techniques which Employee may make, conceive, discover or
develop, either solely or jointly with any other person or persons, at any time
during the term of this Agreement, whether during working hours or at any other
time and whether at the request or upon the suggestion of Company or otherwise,
which relate to or are useful in connection with any business now or hereafter
carried on or contemplated by Company, including developments or expansions of
its present fields of operations, shall be the sole and exclusive property of
Company. Employee shall make full disclosure to Company of all such writings,
inventions, improvements, processes, procedures and techniques, and shall do
everything necessary or desirable to vest the absolute title thereto in Company.
Employee shall write and prepare all specifications and procedures regarding
such inventions, improvements, processes, procedures and techniques and
otherwise aid and assist Company so that Company can prepare and present
applications for copyright or Letters Patent therefor and can secure such
copyright or Letters Patent wherever possible, as well as reissues, renewals,
and extensions thereof, and can obtain the record title to such copyright or
patents so that Company shall be the sole and absolute owner thereof in all
countries in which it may desire to have copyright or patent protection.
Employee shall not be entitled to any additional or special compensation or
reimbursement regarding any and all such writings, inventions, improvements,
processes, procedures and techniques, except that Company shall reimburse
Employee for any expenses which Employee may incur investing absolute title
thereto in Company.

                  (d) Employee acknowledges that the restrictions contained in
the foregoing subparagraphs (a), (b), and (c), in view of the nature of the
business in which Company is engaged, are reasonable and necessary in order to
protect the legitimate interests of Company, and that any violation thereof
would result in irreparable injuries to Company, and Employee therefore
acknowledges that, in the event of his violation of any of these restrictions,
Company shall be entitled to obtain from any court of competent jurisdiction
preliminary and permanent injunctive relief as well as damages and an equitable
accounting of all earnings, profits and other benefits arising from such
violation, which rights shall be cumulative and in addition to any other rights
or remedies to which Company may be entitled.


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                  (e) Employee agrees that if any or any portion of the
foregoing covenants or the application thereof, is construed to be invalid or
unenforceable, the remainder of such covenant or covenants shall not be affected
and the remaining covenant or covenants shall then be given full force and
effect without regard to the invalid or unenforceable portion(s). If the
covenant is held to be unenforceable because of the area covered, the duration
thereof or the scope thereof, Employee agrees that the court making such
determination shall have the power to reduce the area and/or the duration and/or
scope thereof, and the covenant shall then be enforceable in its reduced form.

                  (f) If Employee violates any of the restrictions contained in
the foregoing subparagraph (a), the restrictive period shall not run in favor of
Employee from the time of the commencement of any violation until such time as
the violation shall be cured by Employee to satisfaction of Company.

         14. Prior Agreements. Employee represents to Company (a) that there are
no restrictions, agreements or understandings whatsoever to which Employee is a
party which would prevent or make unlawful his execution of this Agreement or
his employment hereunder; (b) there are no agreements, restrictions or
understandings whatsoever to which Employee is a party which place any
limitations as to the companies or individuals with whom he may do business, (c)
that his execution of this Agreement and his employment hereunder shall not
constitute a breach of any contract, agreement or understanding, oral or
written, to which he is a party and by which he is bound; and (d) that he is
free and able to execute this Agreement and to enter into employment by Company.

         15.      Miscellaneous.

                  (a) Waiver. The waiver by Company of a breach of any provision
of this Agreement by Employee shall not operate or be construed as a waiver of
any subsequent breach by Employee. No waiver shall be valid unless in writing
and signed by Company's President.

                  (b) Controlling Law. This Agreement and all questions relating
to validity, interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be governed by
and construed in accordance with the laws of the Commonwealth of Pennsylvania,
and without the aid of any canon, custom or rule of law requiring construction
against the draftsman.


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                  (c) Notices. All notices, requests, demands and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given, made and received only when
delivered (personally, by courier service such as Federal Express, or by other
messenger) or when deposited in the United States mails, registered or certified
mail, postage prepaid, return receipt requested, addressed in the case of
Company, to its President at its principal place of business, and in case of
Employee, to his home address,

                  (d) Binding Nature of Agreement. This Agreement shall be
binding upon and inure to the benefit of Company and its successors and assigns
and shall be binding upon Employee, his heirs and legal representatives.

                  (e) Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original
as against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument.

                  (f) Provisions Separable. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.

                  (g) Entire Agreement. This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements and
understandings, inducements or conditions, express or implied, oral or written.
The express terms hereof control and supersede any course of performance and/or
usage of the trade inconsistent with any of the terms hereof. This Agreement may
not be modified or amended other than by an agreement in writing and signed by
the Company's President.

                  (h) Paragraph Headings. The paragraph headings in this
Agreement are for convenience only; they form no part of this Agreement and
shall not affect its interpretation.

                  (i) Survival. The covenants contained in Paragraphs 12 and 13
shall survive the expiration of this Agreement and the termination of Employee's
employment.

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                  (j) Number of Days. In computing the number of days for
purposes of this Agreement, all days shall be counted, including Saturdays,
Sundays and holidays, provided, however, that if the final day of any time
period falls on a Saturday, Sunday or holiday on which federal banks are or may
elect to be closed, then the final day shall be deemed to be the next day which
is not a Saturday, Sunday or such holiday.

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                  IN WITNESS WHEREOF, the parties have executed and delivered
this Agreement in Langhorne, Pennsylvania on the date first above written.

ICT GROUP, INC.



By:                                     
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         John J. Brennan                       Vince Paccapaniccia





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            Date                                      Date