Business Workshop: Age claim releases tricky
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When laying off or firing employees, employers frequently ask for a release from possible legal claims in exchange for severance pay.
But there are special requirements attached to releases of age discrimination for employees age 40 and over. The Equal Employment Opportunity Commission has established fairly strict parameters for age discrimination releases. To be effective, these releases must:
• Be written in a manner that can be clearly understood.
• Refer specifically to rights or claims arising under the Age Discrimination in Employment Act.
• Advise the employee in writing to consult an attorney before deciding whether to sign the agreement.
• Give the employee 21 days to consider the offer, or 45 days if it's a group layoff ("group" meaning two or more employees).
• Give the employee seven days after signing to revoke the signature.
• Include a payment that is over and above what the employee already is entitled to receive upon separation, if anything.
The release can cover only actions that took place before the employee signs it; it cannot cover any future actions by the employer. The EEOC has a full set of regulations for waivers of age discrimination at its website, www.eeoc.gov.
Because of the aging of the work force, especially in Western Pennsylvania, and the current state of the economy, employers are encountering more situations involving separations of employees age 40 and above. The well-advised employer will have a standard age claim release and set of procedures for handling layoffs or terminations involving employees age 40 and above.
-- Jane Lewis Volk, Meyer
Unkovic & Scott
First Published January 7, 2013 12:00 am