Stoel Rives World of Employment

EEOC Issues Guidance on Severance Agreements and Waivers

Recognizing that severance agreements are becoming more and more prevailant in the down economy, the Equal Employment Opportunity Commission (EEOC) yesterday issued a new technical assistance document titled Understanding Waivers of Discrimination Claims in Employee Severance Agreements (click on the title to access the document).  The new document is intended to help both employers and employees navigate the complexities of waivers in severance agreements.

Of particular interest is the EEOC's guidance regarding the Older Workers Benefit Protection Act, which places certain requirements on waivers of age discrimination claims by employees age 40 and older, including a 21 day period to consider the agreement and a seven day period to revoke acceptance.  Also of note is the EEOC's admonition that signing a severance agreement and accepting payment to waive discrimination claims does not prevent an employee from then filing a charge of discrimination with the Commission or a similar state agency. 

Employers should review their existing severance agreements in light of the EEOC's new guidance, as this document provides insight into how both the Commission and courts will review such agreements and how employees might find ways to avoid their waiver obligations. 

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