Drafting Severance Agreement to Release Federal Age Discrimination Claims
MINIMUM REQUIREMENTS OF AN EFFECTIVE RELEASE OF FEDERAL AGE DISCRIMINATION CLAIMSFor a Severance or Separation Agreement to effectively release an employee's federal age discrimination claims, the release must be "knowing and voluntary," which means, at a minimum:
1. A waiver must be written in a manner that can be clearly understood.
2. A waiver must specifically refer to rights or claims arising under the ADEA. It must expressly spell out the Age Discrimination in Employment Act (ADEA) by name.
3. A waiver must advise the employee in writing to consult an attorney before accepting the agreement.
4. A waiver must provide the employee with at least 21 days to consider the offer.
5. A waiver must give an employee seven days to revoke his or her signature. The seven-day revocation period cannot be changed or waived by either party.
6. A waiver must not include rights and claims that may arise after the date on which the waiver is executed.
7. A waiver must be supported by consideration in addition to that to which the employee already is entitled.
ADDITIONAL REQUIREMENTS FOR GROUP LAYOFFS OF EMPLOYEES AGE 40 AND OVERIn addition, there are additional requirements for an effective waiver of age discrimination claims when an employer conducts group layoffs of employees age 40 and over. In this case, the waiver must meet the minimum the seven minimum "knowing and voluntary" requirements above. An employer must give the employee age 40 and over that is subject to the group layoff - and all other employees who are being laid off with him or her - written notice of the layoff and at least 45 days to consider the waiver before signing it. Specifically, the employer must inform such an employee in writing of:
1. The "decisional unit" - the class , unit, or group of employees from which the employer chose the employees who were and who were not selected for the program;
2. Eligibility factors for the program;
3. The time limits applicable to the program;
4. The job titles and ages of all individuals who are eligible or selected for the program.