A chance meeting my husband and I had with an older gentleman at a bar in Charleston, South Carolina, where this good ol’ boy resided, prompted me to write this post about releases.
Upon learning what I did for a living, this man, let’s call him Neil, proceeded to tell me about the employees who wanted to sue his Cincinnati business for discrimination. I agreed with the action he took—pay them a severance and have them sign a release not to sue—and told him so.
Then I said, “Well, you know of course, that any of these employees can still file a Charge of Discrimination with the EEOC.”
He then put his hand, like a stop sign, in front of my face—yes, you read that right—and said, “Darlin’, I don’t need your advice. I have the top lawyers in Cincinnati, and they tell me it’s done, so it’s done.”
Yeah, so he basically shushed me. That hasn’t happened since the ‘90’s!
Anyway, he and his lawyers are wrong.
Generally, an employee may file a Charge of Discrimination with the Equal Employment Opportunity Commission (EEOC) against his or her employer within 180 days from when the discrimination took place. This filing deadline is extended to 300 days if the state you’re in has an agency enforcing the anti-discrimination laws on a state level. (Hint: most do).
A release of claims against a company must be knowing and voluntary, which has different requirements depending on whether or not the employee is over 40 (a subject for another day), but one fact that seems to surprise employers:
Even if your employee signs a waiver releasing all claims, the employee can still file a charge with the EEOC if the employee believes that (s)he was discriminated against during employment or wrongfully terminated and files within the deadline.
In addition, no agreement between employer and employee can limit an employee’s right to file a Charge, testify, assist, or participate in an investigation, hearing, or proceeding conducted by the EEOC under Title VII of the Civil Rights Act of 1964, as amended (prohibiting discrimination on the basis of race, color, religion, sex, or national origin); the Equal Pay Act of 1963 (prohibiting agencies from paying different wages to men and women performing equal work in the same work place); the Age Discrimination in Employment Act of 1967, as amended (prohibiting discrimination against persons age 40 or older); or the Americans with Disabilities Act (prohibiting discrimination on the basis of disability).
Any provision in a waiver and release of claims that attempts to waive these rights is unlawful (as retaliation) and unenforceable. This is not my Northern Yankee opinion; this is law.
Employer Takeaway: There are a few.
First, don’t use overly broad language in your release and know that your former employee can still file a charge with the EEOC if the employee believe(s) he was discriminated against during employment or wrongfully terminated.
Second, don’t state in your release that the employee waives any right to file a Charge of Discrimination with the EEOC. If push comes to shove, it’s likely that your release will be deemed invalid and unenforceable.
Third, and this is a little known fact that I’m sharing with you: you cannot lawfully require a former employee to return the money or benefits you gave that employee in exchange for his or her waiving of rights if the employee does file a Charge.
This can be a complex issue, and you want your waiver and release to be lawful and enforceable, so the fourth bit of advice? Contact an employment attorney to carefully draft the waiver and release and advise you accordingly.