Employers can offer severance payments to older workers they plan to terminate in exchange for a release of age discrimination claims. But the severance agreement must comply with the Older Workers Benefit Protection Act (OWBPA) in order to stick.
To comply with OWBPA, the agreement must be written clearly and simply enough that the employee can understand what he is signing. That means keeping it free of legal mumbo jumbo.
Recent case: Thomas Ridinger worked for Dow Jones & Company until he was offered a severance package in exchange for agreeing not to file a lawsuit against the company. He sued anyway, arguing that the agreement didn’t comply with the OWBPA.
The court dismissed Ridinger’s lawsuit, reasoning that there was nothing complicated in the agreement, which used common, everyday language. (Ridinger v. Dow Jones & Company, No. 10-1771, 2nd Cir., 2011)