Can a severance agreement waiving age claims prevent an ADEA suit?

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in Discrimination and Harassment,Human Resources

Q. We are considering terminating an employee who will turn 41 this month. Can we ask him to sign a severance agreement that includes a release of his age discrimination claims under the ADEA?

A. Yes, if the release satisfies the specific requirements set forth in the Older Workers Benefit Protection Act (OWBPA).

The OWBPA, which amended the Age Discrimination in Employment Act (ADEA), imposes detailed requirements on employers that seek to enter into valid release agreements with employees age 40 or older that extend to age discrimination claims.

At a minimum, the release of your employee’s age claims under the ADEA must:

  1. Specifically indicate that the employee is giving up rights or claims arising under the ADEA
  2. Indicate that the employee does not waive any rights or claims arising after his execution of the release
  3. Provide the employee consideration (different than what he is already entitled to receive)
  4. Advise the employee in writing to consult with an attorney before signing the release
  5. Allow the employee at least 21 days to consider the release before signing
  6. Give the employee at least seven days following execution of the release to revoke it, and indicate that the release will not become effective until the revocation period has passed.

Note that failure to meet all the criteria outlined in the statute will render invalid your employee’s release of his age discrimination claims under the ADEA.

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