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Can I Sue for Overtime after Signing Separation/Release Agreement?

Los Angeles, CA |

I was asked to resign from my recent employer. I was offered 3 weeks severance pay. I feel I have been incorrectly classified as an exempt employee and therefore am owed overtime (equivalent to more than 3 weeks of pay). I heard that by signing the separation/release agreement, I am only waiving my ability to sue in California court, not Federal court. So in essence, I can still sign the agreement, get the 3 weeks of severance, and sue for overtime. Is this true?

Actual agreement looks like it was copied and pasted from here: http://www.sec.gov/Archives/edgar/data/1511737/000119312512201585/d307868dex1017.htm

Attorney Answers 3

Posted

If you want a thorough review to decide if you have a case for unpaid wages, you need to see an attorney who regularly handles those cases. A response on Avvo does not constitute a legal opinion. Also, most labor lawyers and employment lawyers will give you a free consultation to evaluate your facts and documentation. If you have a good case, they will normally take the case without an upfront fee, since fees are part of the claim against an employer who does not pay proper wages. Try Avvo's "find a lawyer" tab for a lawyer in your area who handles these cases.

Questions that your posting don't answer but cry out for an attorney who has experience: (a) Is the waiver valid? (b) What is included in the waiver and what is not? (c) Does this waiver prohibit you from filing in State Court? What about the Labor Commissioner? (d) How much money is the difference that is at issue if you should have been paid wages?

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Asker

Posted

Please see additional information section above, regarding the content of the agreement.

Posted

The general answer to your general question is that if your severance agreement contained an enforceable general release of all claims, and you signed the agreement and took the severance payment, and the payment was "new money" meaning not money already owed to you at the time of the agreement, then it is likely you have released the company of any an all claims you have for additional compensation.

If you believe you have a significant claim for overtime, it might make sense for you to have an attorney review the severance agreement to see if there are any ways to undue it. If you think that is where you want to go, you should locate and consult with an experienced employment law attorney as soon as possible to explore your facts and determine your options. I would suggest you look either on this site in the Find a Lawyer section, or go to www.cela.org, the home page for the California Employment Lawyers Association, an organization whose members are dedicated to the representation of employees against their employers.

Good luck to you.

This answer should not be construed to create any attorney-client relationship. Such a relationship can be formed only through the mutual execution of an attorney-client agreement. The answer given is based on the extremely limited facts provided and the proper course of action might change significantly with the introduction of other facts. All who read this answer should not rely on the answer to govern their conduct. Please seek the advice of competent counsel after disclosing all facts to that attorney. This answer is intended for California residents only. The answering party is only licensed to practice in the State of California.

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4 comments

Asker

Posted

Actually my attorney is the one who suggested signing the agreement anyways (without actually seeing it), saying that in most release agreements he has seen, you can still get away with suing in Federal court. I felt a little uncomfortable with what my attorney said, and this is why I asked the question :-)

Neil Pedersen

Neil Pedersen

Posted

Bad advice.

Asker

Posted

Something to the extent that "FLSA rights cannot be abridged by contract or otherwise waived because this would ‘nullify the purposes’ of the statute and thwart the legislative policies it was designed to effectuate" http://www.gpo.gov/fdsys/pkg/USCOURTS-caed-2_09-cv-02017/pdf/USCOURTS-caed-2_09-cv-02017-1.pdf

Neil Pedersen

Neil Pedersen

Posted

An employer cannot ask an employee to waive certain unwaivable rights prospectively, but an employer and employee can agree to settle a claim by payment of something of value from the employer. That is why you were offered a severance payment. It was a payment to buy your agreement to release the employer.

Posted

In the U.S. Eleventh Circuit, where I practice, no agreement resolving an overtime claim under the FLSA is valid unless approved by the Court or the U.S. Department of Labor. You may wish to contact an attorney who specializes in wage and hour claims in California and determine whether the Courts in California have a similar requirement. Good luck.

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5 comments

Asker

Posted

When you say no agreement, you also mean a termination "Release" agreement in which you explicitly release the employer from all future liability and lawsuits in exchange for severance, right?

Ainsworth G. Dudley Jr.

Ainsworth G. Dudley Jr.

Posted

Any agreement compromising an overtime claim must be approved by the Court or the U.S. Department of Labor.

Asker

Posted

I have contacted several California attorneys regarding this issue and they denied it. Only one attorney in California said this. This is the same attorney who told me I would be giving up my right to sue in California court , but not Federal court (see original question above). So it seems that what you said is true, but doesn't apply in California, since all California attorneys I have spoken to did not acknowledge or know this.

Ainsworth G. Dudley Jr.

Ainsworth G. Dudley Jr.

Posted

Talk with an atorney who specializes in FLSA law. How many overtime hours do you feel you have been shortchanged?

Asker

Posted

At least 600 hours.

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