Q. I have been told the company cannot require an employee to sign a valid release of a potentialclaim. We recently have gone through a downsizing. We have a severance policy that provides a nice benefit, but to qualify, the employee must sign a general release promising not to sue the company over any employment-related matter. The release includes any claim under the FMLA. Is that OK?
A. Regulations promulgated by the U.S. Labor Department provide as follows: “Employees cannot waive, nor may employers induce employees to waive, their rights under FMLA.” Paying an employee to give up an FMLA claim sure sounds like “inducing” the employee to waive his or her rights.
The Labor Department has taken the position that agreeing to release an FMLA claim as part of a settlement of some kind is permissible and enforceable, and normally the department’s interpretation of its own regulation would be accorded great deference.
Some courts have distinguished the waiver of a substantive right to (which cannot be waived or negotiated away) from the right to settle a potential or actual claim. That is how Labor views it, too.
However, one federal Court of Appeals has held that any settlement of an FMLA claim is invalid unless approved by Labor or a court, finding that the department’s interpretation of the regulation is totally inconsistent with the plain meaning of the regulation. My feeling is that the courts in Michigan and the 6th Circuit Court of Appeals may well permit FMLA claims to be waived, but it is by no means certain.
There are many claims that cannot be waived. Michigan workers’ compensation claims cannot be waived or settled unless approved by an administrative law judge. Employees cannot validly waive the right to file a discrimination charge with the EEOC, although they can waive any financial recovery in the event of a favorable determination. An employee cannot waive a claim for Michigan unemployment compensation. Broad releases that have purported to waive some claims that cannot be waived have been challenged in their entirety by the EEOC on the basis that they are misleading.
You should have your labor attorney review your release agreement to make sure you understand what claims actually are being released.