If the separation agreement requires the employee to waive his right to sue the employer and release all claims, then the agreement must contain a form of new consideration that the employee was not already expecting to receive. A severance payment, for example, that was not already promised to the employee would constitute new consideration.
Any timelines that the employee is entitled to should be spelled out in the agreement. For example, under the Age Discrimination in Employment Act and the Older Workers Benefits Protection Act, employees who are 40 years old or older are entitled to 21 days to review the separation agreement, and 7 days after signing to revoke the agreement. These timelines, and other related time limits, should be expressed in the body of the document.
Agreements should not contain any language which suggests that the employer is trying to cover up unlawful discrimination, discourage reporting of discrimination claims, or prompt an employee to abort an existing claim or recant his recent testimony. While a severance agreement can be used lawfully to prevent an employee lawsuit, it should not be used to thwart an ongoing discrimination investigation, inhibit the right to report instances of discrimination to government agencies or obstruct an employee’s agreement to cooperate in another employee’s claim.
The agreement between an employer and an employee should not include any provision prohibiting an employee from making a report or filing a charge with the Equal Employment Opportunity Commission. It should not stop an employee from participating in an EEOC investigation or administrative proceeding. Even if the waiver language prohibits the employee from suing the employee for employment discrimination or from collecting damages based on such a claim, the employee may still file an administrative complaint with the EEOC.